Corporate Ownership and ESG Performance

Corporate Ownership and ESG Performance

“Does ownership matter?  With average holding periods of publicly-traded stock measured in months, share ownership may not effect firm’s long-term practices and activities.  Yet, large shareholders surely have a stronger voice than others and their holding periods are considerably longer. Hence, their preferences might influence the choices made by firms, especially regarding corporate practices around environmental, social, and governance (ESG) issues.”

[COMMENTARY] The research cited in this article says the type of ownership in a company matters regarding ESG practices. Owners with longer-term interests are more favourable to incorporating ESG activities.
Corporate Ownership and ESG Performance, by Peter Tufano (Harvard Business School), Belen Villalonga (NYU), and Boya Wang (University of Cambridge), January 28, 2025, Harvard Law School Forum on Corporate Governance, USA.

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