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Does the Indian Stock Market encourage Socially Responsible Companies?

MANTHAN: Journal of Commerce and Management

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Title Does the Indian Stock Market encourage Socially Responsible Companies?
 
Creator Murthy, K. V. Bhanu; Professor, Department of Commerce, Delhi School of Economics, University of Delhi
Bhandari, Varun; Research Scholar, Department of Commerce, Delhi School of Economics, University of Delhi
Pandey, and Vishal; Research Scholar, Department of Commerce, Delhi School of Economics, University of Delhi
 
Subject Business Ethics, Corporate Social Responsibility, Efficient Market Hypothesis, ESG Index, NIFTY Index
 
Description A paradigm shift has taken place in the conceptual framework of Corporate Responsibility which has led to the emergence of a holistic approach towards Governance, Corporate Social Responsibility and Environmental Accountability. We expect that social responsibility has a distinct and positive effect on the security prices in the stock market. This paper aims at studying the broad trends in the market in terms of ESG, as proxy of socially responsible companies, and NIFTY, as the proxy of general companies, to identify the breaks, if any, and to examine the price discovery process in both the indices, in terms of growth rate. We have identified three periods i.e. pre-crisis, crisis and post-crisis period. We conclude that the growth rate and return is more in ESG index than NIFTY index. Hence, social responsible companies are performing better than general companies both in terms of price discovery and returns, for the whole period. After the crisis the investors had become sensitised to social responsibility and had begun to absorb and internalise the behaviour of socially responsible companies in the price discovery process.
 
Publisher Journal Press India
 
Date 2015-06-30
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://www.myresearchjournals.com/index.php/MANTHAN/article/view/2431
10.17492/manthan.v1i1.2431
 
Source MANTHAN: Journal of Commerce and Management; Vol 1, No 1 (2014)
2347-4440
 
Language eng
 
Relation http://www.myresearchjournals.com/index.php/MANTHAN/article/view/2431/2360
 
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MANTHAN: Journal of Commerce and Management