Investment Performance of 'Environmentally-Friendly' Firms and their Initial Public Offers and Seasoned Equity Offers
26 Pages Posted: 6 Sep 2009 Last revised: 25 Feb 2014
Date Written: February 21, 2014
Abstract
We employ a sample of 748 environmentally-friendly (or “green”) firms listed on U.S. stock exchanges to extend studies of the effects of socially responsible investment (SRI) on stock investment returns and the performance of initial public offerings (IPOs) and seasoned equity offerings (SEOs). Our empirical tests document positive and statistically significant excess returns for our environmentally-friendly firms and their IPOs and SEOs, in contrast to our control IPO and SEO samples which underperform. In summary, a “green” equity premium is evident in returns calculated from a variety of benchmarks.
Keywords: Initial public offerings, seasoned equity offerings, event studies, environment, green, equity performance
JEL Classification: G14, G15, G39
Suggested Citation: Suggested Citation
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