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Environmental, Social and Governance Risk versus Company Performance

  • Türker ŞimşekEmail author
  • Halil İbrahim Aydın
  • Bartosz Oliwa
Chapter
Part of the Palgrave Studies in Impact Finance book series (SIF)

Abstract

Environmental, social and governance risks (ESG risks), which do not include a financial structure, are risks that are externally accepted and can directly affect the performance of the economy. The risks of ESG can cause investors to face and fight financial challenges as well as financial difficulties. Investors who plan to overcome these challenges with the least amount of damage implement various strategies to improve risk management. An investment that harms the environment creates a social risk by disturbing the ecosystem and attracting a negative public reaction. Permitting such investments creates the perception that there is a lack of governance in the society and the risk of governance arises. As can be seen, the risks of ESG are interrelated. For this reason, the chapter aims to explain the risk factors of ESG and to present suggestions to shed light on the issues for policy decision-makers.

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Copyright information

© The Author(s) 2019

Authors and Affiliations

  • Türker Şimşek
    • 1
    Email author
  • Halil İbrahim Aydın
    • 2
  • Bartosz Oliwa
    • 3
  1. 1.Tokat Gaziosmanpaşa UniversityTokatTurkey
  2. 2.Batman UniversityBatmanTurkey
  3. 3.University of SzczecinSzczecinPoland

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