ESG scores and cash holdings: The role of disciplinary trading

被引：7
|
作者：
Liu, Benjamin [1 ]
Johl, Shireenjit [1 ]
Lasantha, Ruwan [1 ,2 ]
机构：
[1] Griffith Univ, Griffith Business Sch, Dept Accounting Finance & Econ, Brisbane, Australia
[2] Univ Kelaniya, Fac Commerce & Management Studies, Dept Commerce & Financial Management, Kelaniya, Sri Lanka
来源：
FINANCE RESEARCH LETTERS | 2023年 / 55卷
关键词：
Agency theory; Cash holdings; Corporate governance; Disciplinary trading; ESG; Stock liquidity; STOCK LIQUIDITY EVIDENCE; CORPORATE GOVERNANCE; GENDER DIVERSITY;
D O I：
10.1016/j.frl.2023.103854
中图分类号：
F8 [财政、金融];
学科分类号：
0202 ;
摘要：
Investors increasingly use ESG information for their investment decisions. The purpose of this study is to investigate whether investors practise disciplinary trading using the ESG scores provided by rating agencies to influence firms' cash holdings. Employing a larger sample of US listed firms, we find that stock liquidity acts as a channel between ESG scores and cash holdings. ESG scores carry vital information on the effectiveness of firms' governance and agency problems. Hence, investors respond to ESG information through stock trading that send signals to management, resulting in changes in firms' cash holdings. Consequently, investors use stock trading as a mechanism to create the necessary push for insiders to resolve agency problems.
引用
收藏
页数：12
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