Shareholder Engagement on Environmental, Social, and Governance Performance

Shareholder Engagement on Environmental, Social, and Governance Performance

Tamas Barko, Martijn Cremers, Luc Renneboog

Series number :

Serial Number: 

Date posted :

June 02 2017

Last revised :

September 07 2018
SSRN Share


  • investor activism; corporate social responsibility; socially responsible investing (SRI); engagement; environmental • 
  • social and governance (ESG)

We study investor activism promoting environmental, social and governance (ESG) improvements using a proprietary dataset. Targets have a higher market share, analyst coverage, stock returns, and liquidity. The engagements lead to ESG rating adjustments. Activism is more likely to succeed when targets have a good ex ante ESG track record, lower ownership concentration and growth.

Successful engagements positively affect sales growth, without changing profitability. A portfolio of targeted firms earns superior returns to that of matched firms. E.g., targets in the ex ante lowest ESG quartile outperform non-engaged peers by 4.7%. Similarly, successful engagements generate higher returns than unsuccessful ones.

Published in

Published in: 
CentER Discussion Paper Series No. 2017-040 | TILEC Discussion Paper No. DP 2017-021


Real name:
Tamas Barko
University of Mannheim