Do ESG activities help firms in times of financial difficulty?

  • Bernhard Lorenz Jaup (Student)

Student thesis: Master's Thesis


This research examines how firms' engagement in ESG practices influences their stability and attractiveness to investors. Using the frameworks of social and historical aspiration, and legitimization pressure, statistical analysis over 20 years for over 500 firms was conducted. Firstly, it was shown that firms who face financial and aspirational challenges invest more in ESG compared to those who do not. We also found that ESG activities are not suitable for mitigating a decrease in relative market value for all companies. Investors tended to value the response to a downturn more than the price depreciation itself. Looking into firms that experience above-average shortfalls, the results change suggesting that ESG is useful for mitigating decreases in firm legitimacy.
Date of Award31 Jan 2024
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorPeter V. Rajsingh (Supervisor)


  • ESG performance
  • Legitimization theory
  • Aspiration
  • Financial shortfall


  • Mestrado em Gestão e Administração de Empresas

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