Middle East Technical University, Turkey

DOES BEING GREEN CREATE A SOCIAL IMPACT? A STUDY ON CAPITAL INVESTMENT

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Abstract

This study explores the impact of greenness on real capital investments for all NYSE firms between 2002 and 2021. Greenness of a firm is measured by adjusting the Environment component of its ESG score for industry and market effects. The relationship between greenness and investment is examined by using two different methodologies. The dynamic panel regression results show that green firms invest more, regardless of how greenness is defined. Quantile regression results imply that companies that have lower levels of capital investment tend to invest more when they are greener, compared to companies that have higher levels of capital investment. Findings of the study are consistent with Pastor, Stambaugh and Taylor’s ​(2021)​ prediction that the market will become greener over time as a result of greener firms having higher levels of capital investment compared to brown firms.

Biography

I hold a BSc in Business Administration and an MSc in Financial Mathematics from Middle East Technical University. My master's thesis delved into the impact of macroeconomic announcements on stock market volatility using statistical modeling and GARCH analysis. Currently pursuing a Ph.D. in Finance, I investigate the social impact of sustainable investing, utilizing dynamic panel data models with GMM estimator and quantile regression time series models. My focus is on capital investment and ESG data, aiming to investigate the effect of greenness, or being environmentally responsible, on the real social impact created by companies. I've also earned an LL.B from Cankaya University, enhancing my understanding of the legal framework crucial to business decisions. I'm keen on sustainable investing, innovative financial methods, and programming in R, Stata, Python, and EViews. Proficient in databases like Thomson Reuters Eikon and Bloomberg, I also excel in scientific writing with LaTeX and Microsoft Office.