Advanced

The effect of ESG Rating on Credit Rating for Firms of Real Estate

Sadia, Jad LU and Palmquist, Sissa (2020) NEKN02 20201
Department of Economics
Abstract
The purpose of this study is to investigate the effect of ESG ratings on firm’s credit ratings for real estate investment trusts in the USA. Through a quantitative research methodology, a panel data regression analysis is used in order to examine the effect of ESG rating on firms’ credit ratings. The sample used in our study consists of a set of unbalanced panel data consisting of 3,470 firm-month observations representing 50 unique REITs in the USA over the period 2009-2017. We find that total ESG rating has a significant positive effect on credit rating. Our results show that in order for REITs to enhance their credit rating in relation to CSR activities, they should focus essentially on the environmental dimension’s activities, and... (More)
The purpose of this study is to investigate the effect of ESG ratings on firm’s credit ratings for real estate investment trusts in the USA. Through a quantitative research methodology, a panel data regression analysis is used in order to examine the effect of ESG rating on firms’ credit ratings. The sample used in our study consists of a set of unbalanced panel data consisting of 3,470 firm-month observations representing 50 unique REITs in the USA over the period 2009-2017. We find that total ESG rating has a significant positive effect on credit rating. Our results show that in order for REITs to enhance their credit rating in relation to CSR activities, they should focus essentially on the environmental dimension’s activities, and partially on the governance dimension’s activities, while social dimension’s activities are estimated to be inessential. (Less)
Please use this url to cite or link to this publication:
author
Sadia, Jad LU and Palmquist, Sissa
supervisor
organization
course
NEKN02 20201
year
type
H1 - Master's Degree (One Year)
subject
keywords
Credit Rating, ESG, Corporate Social Responsibility, Corporate Social Performance, Real Estate Investment Trusts.
language
English
id
9016230
date added to LUP
2020-08-29 11:21:01
date last changed
2020-08-29 11:21:01
@misc{9016230,
  abstract     = {The purpose of this study is to investigate the effect of ESG ratings on firm’s credit ratings for real estate investment trusts in the USA. Through a quantitative research methodology, a panel data regression analysis is used in order to examine the effect of ESG rating on firms’ credit ratings. The sample used in our study consists of a set of unbalanced panel data consisting of 3,470 firm-month observations representing 50 unique REITs in the USA over the period 2009-2017. We find that total ESG rating has a significant positive effect on credit rating. Our results show that in order for REITs to enhance their credit rating in relation to CSR activities, they should focus essentially on the environmental dimension’s activities, and partially on the governance dimension’s activities, while social dimension’s activities are estimated to be inessential.},
  author       = {Sadia, Jad and Palmquist, Sissa},
  keyword      = {Credit Rating,ESG,Corporate Social Responsibility,Corporate Social Performance,Real Estate Investment Trusts.},
  language     = {eng},
  note         = {Student Paper},
  title        = {The effect of ESG Rating on Credit Rating for Firms of Real Estate},
  year         = {2020},
}