Determinants of the inclusion in the BM&FBOVESPA Corporate Sustainability Index and its relationship with firm value

• Main Authors: Lélis Pedro Andrade, Aureliano Angel Bressan, Robert Aldo Iquiapaza, Bruno César de Melo Moreira
• Format: Article
• Language: English
• Published: Brazilian Society of Finance 2013-07-01
• Series: Revista Brasileira de Finanças
• Subjects: Corporate Sustainability Index (CSI); firm value; financial crisis
• Online Access: http://bibliotecadigital.fgv.br/ojs/index.php/rbfin/article/view/5923

The aim of this study was to identify the variables that influence the firms inclusion in the BM&FBOVESPA Corporate Sustainability Index (CSI), and if such membership is correlated with the firm market value in the Brazilian market. We collected annual data of firms for the period 2006 to 2011. The methodology included the use of methods such as regression analysis type logit and panel data models. The results showed that companies that have joined the ISE have characteristics distinct from those who did not opt for membership. Firms with larger size, higher profitability and sectors considered high environmental impact are more likely to be classified in the ISE. When examined whether inclusion in the CSI has relation with the metric firm value, the results did not reject the hypothesis of positive relationship, even during the financial crisis of 2008, however, found evidence of a negative relationship in the post-crisis period.