The Impact of ESG factors on the performance of Information Technology Companies
Alexandra A. Egorova, Sergei Grishunin, Alexander Karminsky
Abstract
The aim of the paper is to investigate the impact of ESG factors on the performance of information technology (IT) companies. The paper analyzes the position of IT companies in the ESG rating relative to other industries, highlights the key strengths and weaknesses in their ESG components. It is shown that IT companies are not currently the leaders in terms of ESG rating, which leads to the conclusion that IT companies have the opportunity to develop their ESG practice, if its development will improve the position of the company and will have a positive effect on its performance. On the basis of the studied literature, the author formulated that market value of the company is the most suitable as an indicator for assessing the influence of ESG factors on it. In addition, the paper formulates hypotheses that can be used to test the influence of ESG on the market value of IT companies, developed a model to assess such an influence and provide recommendations for data sample. The author intends to continue research and test the formulated hypotheses with the developed model.