This study investigates the intricate relationship between Environmental, Social, and Governance-related reputational disasters and the financial performance of prominent, food-producing agricultural corporations. Results reveal a significant differential response pattern between large and small firms after ESG-related events. Large entities initially exhibit resilience with no immediate negative returns, while smaller entities face substantial, significant, and persistent stock market depreciation. Furthermore, direct interactions are identified between the depth of Corporate Social Responsibility (CSR) incorporation and the severity of stock price decline. For investors, ESG track record emerges as a critical assessment criterion. The theoretical implications extend to understanding the importance of robust ESG frameworks, not just for reputational integrity but also for financial stability. The findings emphasise corporations' urgency to integrate forward-looking, socially responsible strategies, particularly in the agricultural sector.
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http://dx.doi.org/10.1016/j.jenvman.2024.123072 | DOI Listing |
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