Which corporate ESG news does the market react to?

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What type of ESG information does a “reasonable investor” react to? Stock price movements aren’t the final word when analyzing which disclosures are material, but they sure can be instructive. A recent study – “Which Corporate ESG News Does the Market React To?” – conducted by George Serafeim and Aaron Yoon found that stock prices react only to industry-specific financially material ESG news, and the reaction is larger for news that is positive, that receives more news coverage and relates to social capital (relative to natural or human capital) issues.