Influence of Corporate Reputation and Responsible Corporate Behavior on Market Performance
DOI:
https://doi.org/10.51341/cgg.v27i2.3203Keywords:
Corporate reputation, ESG, SDG, CSI, Market performanceAbstract
Objective: To evaluate the influence of corporate reputation and responsible corporate behavior on market performance in publicly traded companies listed on B3.
Method: Quantitative research, using regression by ordinary least squares (OLS), with control of fixed effects of year and sector and robust standard error. The sample comprised 84 companies listed on B3, resulting in 504 observations corresponding to the period from 2016 to 2021.
Originality/Relevance: The study expands evidence on the implications of the different factors of responsible corporate behavior and corporate reputation, both individually and interactively, on the market performance of companies. It considers different proxies for responsible corporate behavior, which capture complementary perspectives on the market performance of Brazilian companies.
Results: Companies with a higher corporate reputation have a higher market-to-book and price/profit ratio. Regarding the influence of responsible corporate behavior, it was found that companies with a higher ESG score and that adopt the SDGs in their sustainability reports have a higher market-to-book index. As for the joint effect, the results showed interaction only between corporate reputation and ESG practices with the market-to-book index.
Theoretical/Methodological Contributions: The research contributes by demonstrating that investment in responsible practices and corporate reputation induce value creation for companies, which are perceived by investors as more attractive. In addition, it demonstrates that good corporate reputation generates higher market expectations about such companies, driving share price growth.
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