“A study of more than 6,700 S&P 500 ESG rating changes finds that downgrades hit share prices harder when investor sentiment is already strongly positive – suggesting that the higher the expectations, the harder companies fall when their sustainability scores slip.”

[COMMENTARY] When investors are strongly positive, it often precedes many believing a market top might be near. Hence, the propensity to sell on any negative news. This is what I’ve believed for many years, and now this study appears to support that view.
ESG downgrades hit shares harder when investor expectations are high, study finds, by Taejun Kang, August 24, 2026, Eco Business, Australia.