ESG disclosure and portfolio performance

This paper illustrates the impact of Environmental Social and Governance (ESG) disclosure
on European corporate equity performance. In this study, we use an extensive data set of European
ESG ratings provided by Bloomberg to demonstrate that ESG disclosure is associated with improved
return growth, with the Governance pillar exhibiting the strongest effect on corporate performance.
The impact of ESG disclosure on volatility is changing over time, suggesting that the existence of
opaque ratings limits the transmission of information disclosure into corporate performance.

This paper illustrates the impact of Environmental Social and Governance (ESG) disclosure
on European corporate equity performance. In this study, we use an extensive data set of European
ESG ratings provided by Bloomberg to demonstrate that ESG disclosure is associated with improved
return growth, with the Governance pillar exhibiting the strongest effect on corporate performance.
The impact of ESG disclosure on volatility is changing over time, suggesting that the existence of
opaque ratings limits the transmission of information disclosure into corporate performance.