The impact of human rights on firms' market capitalisation

Since the 1970s, the issue of corporate social responsibility has evolved and expanded, taking on increasingly complex dimensions. Companies have gradually oriented their actions towards behaviour based on the ESG (environmental, social and governance) perspective, because they are aware of the relevance of these issues and considering the growing pressure from stakeholders. At the same time, the tools for voluntary and mandatory reporting of non-financial information and the reporting standards that guide companies in their reporting have evolved. In this context, investors seem to be paying more and more attention to the information disclosed by companies and orienting their decisions towards ethical and sustainable investments. Although many studies have analysed the impact of ESG variables, none have examined whether respect for human rights has an impact on company market capitalisation. Against this background, this paper aims to fill this specific gap by analysing European companies in order to provide guidance for future research as well as valid suggestions for managers and regulators.