Does Money Talk? Divestitures and Corporate Environmental and Social Policies

Nickolay Gantchev, Mariassunta Giannetti, Rachel Li

2022 | Academic | Decarbonization, ESG Ratings

Can shareholders’ divestitures and threats of exit trigger improvements in firms’ environmental and social (E&S) policies? We show that E&S incidents are followed by some, but relatively small, divestitures.