Shareholder wealth effects of corporate sustainability reporting regulations

In this article, we investigate the impact of the European Union (EU)’s corporate sustainability reporting regulations (i.e., CSRD and ESRS) adoption events on EU firms' stock market performance. To do this, we mobilize financial data from 19,443 firms located in OECD countries over the period from January 01, 2020, to February 16, 2024, consisting of more than 18 million daily observations. Using a Difference-in-Differences framework, we observe that the implementation of the new legislation (CSRD and ESRS) leads to an underperformance of firms located in affected countries (EU) compared to non-affected ones.