The influence of a sustainability report on the cost of capital
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2018-08-18
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en
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This study investigates the influence of a sustainability report on the cost of equity and debt capital. Prior literature has discussed the relationship between a sustainability report and the cost of capital (COC). However, this study provides an additional argument for the existing debate about the influence of sustainability on the cost of debt. The effect of a sustainability report and the COC is explained through the information asymmetry, risk mitigation, and transparency. The findings exhibit a significantly negative association between a sustainability report and the cost of equity capital as well as debt capital. The sample consist of European companies and collected from Eikon ASSET4. Therefore, this study is not only fill the gap in prior research concerning the sustainability report and the COC, but it also provides useful implication for the managers, shareholders, investors, government, and other stakeholders.
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Faculteit der Managementwetenschappen