Business & Management Studies, Trending Research

Does ESG risk management ensure better risk management? Evidence from India

Does ESG risk management ensure better risk management? Evidence from India

The results indicate that even with a turbulent market, ESG index performance is found to be comparatively stable.

Author

Swati Sharma, Assistant Professor, Jindal Global Business School, O.P. Jindal Global University, Sonipat, Haryana, India.

Summary

Sustainability practices by business are being priced and reflected in its market return. Hence the index constituting those companies based on its Environmental, Social and Governance parameter are of interest for researcher to analyze such index performance. The present study investigates the performance of such two indexes i.e., NIFTY 100 Enhanced ESG & NIFTY 100 Sector Leaders Index which are based on better ESG risk managing stocks. For this purpose, the study analyzes the return behavior of index and calculates Value at Risk to predict the return for post covid time.

The results indicate that even with a turbulent market, ESG index performance is found to be comparatively stable. VaR prediction confirms the robustness of tested VaR models for prediction. Lastly, this study concludes that including sustainable activities into business practices not only attracts more profit but also makes financial market and economy stable.

Published in: Procedia Computer Science

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