Do Business Models Matter? Evidence from the SRI Companies Performance and the COVID-19 Pandemic

Melea Press; Janusz Brzeszczyński

doi:10.1016/j.frl.2022.102881

Do Business Models Matter? Evidence from the SRI Companies Performance and the COVID-19 Pandemic

Melea Press^*, Janusz Brzeszczyński

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

6 Citations (Scopus)

60 Downloads (Pure)

Abstract

Business models of companies are rarely analysed in the context of their financial performance, so little is known about how much they should actually matter in the decision-making processes of investors. In this study, we examine the performance of the SRI stocks portfolios in the US market, which are divided into four main business models types. Our results evidence that Brokers business model clearly outperformed the market in the whole period from February 2016 to January 2021. However, when the entire sample is divided into the pre-COVID-19 sub-sample and COVID-19 sub-sample, the outperformance and underperformance effects among the SRI firms disappeared during the COVID-19 pandemic period.

Original language	English
Article number	102881
Number of pages	9
Journal	Finance Research Letters
Volume	48
Early online date	17 May 2022
DOIs	https://doi.org/10.1016/j.frl.2022.102881
Publication status	Published - 1 Aug 2022

Keywords

Business models
COVID-19 pandemic
Financial performance
SRI companies
Stock market
Sustainability

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10.1016/j.frl.2022.102881

Business Models paperAccepted author manuscript, 363 KBLicence: CC BY-NC-ND
1-s2.0-S1544612322001660-mainFinal published version, 970 KBLicence: CC BY

Cite this

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abstract = "Business models of companies are rarely analysed in the context of their financial performance, so little is known about how much they should actually matter in the decision-making processes of investors. In this study, we examine the performance of the SRI stocks portfolios in the US market, which are divided into four main business models types. Our results evidence that Brokers business model clearly outperformed the market in the whole period from February 2016 to January 2021. However, when the entire sample is divided into the pre-COVID-19 sub-sample and COVID-19 sub-sample, the outperformance and underperformance effects among the SRI firms disappeared during the COVID-19 pandemic period.",

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AB - Business models of companies are rarely analysed in the context of their financial performance, so little is known about how much they should actually matter in the decision-making processes of investors. In this study, we examine the performance of the SRI stocks portfolios in the US market, which are divided into four main business models types. Our results evidence that Brokers business model clearly outperformed the market in the whole period from February 2016 to January 2021. However, when the entire sample is divided into the pre-COVID-19 sub-sample and COVID-19 sub-sample, the outperformance and underperformance effects among the SRI firms disappeared during the COVID-19 pandemic period.

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KW - Stock market

KW - Sustainability

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Do Business Models Matter? Evidence from the SRI Companies Performance and the COVID-19 Pandemic

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Keywords

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