Conference Programme
Overview and details of the sessions of this conference. Please select a date or location to show only sessions at that day or location. Please select a single session for detailed view (with abstracts and downloads if available). Note that the schedule is subject to changes.
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Daily Overview |
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Parallel Session 06: Politics, Policy, and Shareholder Pressure Location: Seminar Room 7 (Level 2) Session Chair: Witold Henisz, The Wharton School, University of Pennsylvania | |
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Anti-ESG Policy Spillovers: Evidence from US Public Pension Funds 1: University of Bath; 2: Chinese University of Hong Kong(Shenzhen); 3: Sun Yat-sen University A growing political backlash against sustainable investing has prompted many U.S. states to enact anti-ESG laws restricting public funds from considering ESG factors. We examine how such legislation in implementing states shapes the ESG practices of firms headquartered elsewhere through ownership networks of state pension funds. We find firms with greater exposure to affected pensions experience significant declines in ESG performance, even when headquartered outside the enacting states. These declines arise through both exit and voice channels, and are more pronounced in Republican-leaning states. Financial markets respond asymmetrically: low-ESG firms earn positive announcement-window returns, whereas high-ESG firms show muted reactions. Treated firms also report modest improvements in accounting performance. Overall, our evidence shows that anti-ESG policies can propagate across state borders through capital market linkages. | |