Firms which spent more on social responsibility and had better pre-coronavirus balance sheets suffered less on stock markets in recent months, a US study of over 6,000 companies in 56 economies shows.
In a working paper published by the National Bureau of Economic Research (NBER), Wenzhi Ding of the University of Hong Kong and others explore how five key corporate features could have shaped stock price reactions of different firms.
These features were: financial conditions, supply chain exposure to countries hit by covid-19, corporate social responsibility (CSR), corporate governance, and ownership structure.
Based on how the firms fared on these aspects before the pandemic, the authors analysed weekly stock returns during January-March