Title: Are stock markets influenced by sustainability matter? Evidence from European companies

Authors: Jose M. Moneva, Eduardo Ortas

Addresses: Faculty of Business Administration and Economics, University of Zaragoza, Gran Via 2, Zaragoza 50005, Spain. ' Zaragoza Business School, Accounting and Finance Department, University of Zaragoza, Lorenzo Normante Building, Maria de Luna s/n, Zaragoza 50018, Spain

Abstract: The emergence of ethical investment is a sign of the increasing interest of shareholders in the impact of corporate activities on sustainable development. The objective of this article is to analyse the relationship between the sustainable performance of a company and its financial performance measured by stock market value. Belonging to the Dow Jones Sustainability Index, disclosing a Global Reporting Initiative Sustainability Report and Sustainable Ratings are used as proxies for sustainability. This article is based on sustainability as a multivariate issue, and exploratory factor analysis is used to model the sustainability performance of a sample of European companies.

Keywords: ethical investment; sustainable economy; corporate social responsibility; sustainable performance; value relevance; stock markets; sustainability; Europe; CSR; sustainable development; sustainable economy; financial performance.

DOI: 10.1504/IJSE.2008.020013

International Journal of Sustainable Economy, 2008 Vol.1 No.1, pp.1 - 16

Published online: 21 Aug 2008 *

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