(Mandatory) ESG disclosure and the impact on firm value of publicly listed companies on the western stock market

  • Anne Sophia Gretsch (Student)

Student thesis: Master's Thesis


This thesis investigates the influence of ESG transparency (ESG disclosure) on the firm value of European and US equities, as assessed by Tobin's Q, with the aim of providing a comprehensive picture of the effects ESG Disclosure can have on firm value. Bloomberg's ESG disclosure score is used to evaluate a sample of 644 firms from Europe and the United States (US). To distinguish the sole influence of the mandatory ESG reporting rules, a difference-indifference regression is performed with the exogenous shock being the Non-Financial Reporting Disclosure (NFRD). For this, European enterprises of the Stoxx Europe 600 which are subject to the European Union's (EU) NFRD are benchmarked to US firms of the S&P 500 that do not yet have mandatory reporting processes in place. The empirical study in this thesis demonstrates that ESG disclosure, particularly driven by environmental information disclosure, improves firm value. Mandatory reporting standards, such as the NFRD, impede this positive effect since firms are legally required to reveal ESG information, implying information asymmetry between firms and investors because firms tend to conceal unfavourable information. This thesis emphasizes the significance of developing universal ESG reporting standards to increase transparency and comparability on the stock markets.
Date of Award17 Oct 2023
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorIsaiah Hull (Supervisor)


  • ESG disclosure
  • Environmental disclosure score
  • Bloomberg
  • Firm value
  • Voluntary and mandatory reporting standards
  • Non-financial reporting disclosure
  • Stoxx Europe 600
  • S&P 500


  • Mestrado em Gestão e Administração de Empresas

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