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Non-financial information and cost of equity capital: an empirical analysis in the food and beverage industry

Nicola Raimo (LUM Jean Monnet University, Casamassima, Italy)
Elbano de Nuccio (LUM Jean Monnet University, Casamassima, Italy)
Anastasia Giakoumelou (Bocconi University, Milan, Italy)
Felice Petruzzella (LUM Jean Monnet University, Casamassima, Italy)
Filippo Vitolla (LUM Jean Monnet University, Casamassima, Italy)

British Food Journal

ISSN: 0007-070X

Article publication date: 2 July 2020

Issue publication date: 24 December 2020

2732

Abstract

Purpose

This study examines the effect that environmental, social and governance (ESG) disclosure generates on the cost of equity capital in the food and beverage (F&B) sector.

Design/methodology/approach

This study analyses a sample of 171 international listed firms pertaining to the F&B sector and headquartered in North America, Western Europe and Asia Pacific (developed), forming an unbalanced panel of 1,316 observations, spanning the period 2010–2019. We run a fixed-effects panel regression model to test the relationship between ESG disclosure and the cost of equity capital.

Findings

Our empirical outcomes suggest a significant negative relationship between ESG disclosure and the cost of equity capital. We find support for the notion that increased levels of ESG disclosure are linked to an improved access to financial resources for firms.

Originality/value

This is the first study that analyses the impact of ESG disclosure on the cost of equity capital in the F&B sector, taking existing literature a step further into more detailed and specific aspects of the relationship of focus.

Keywords

Citation

Raimo, N., de Nuccio, E., Giakoumelou, A., Petruzzella, F. and Vitolla, F. (2021), "Non-financial information and cost of equity capital: an empirical analysis in the food and beverage industry", British Food Journal, Vol. 123 No. 1, pp. 49-65. https://doi.org/10.1108/BFJ-03-2020-0278

Publisher

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Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited

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