ESC
Clarivate

 
Source: Journal Citation ReportsTM from ClarivateTM 2022

Entrepreneurship and Sustainability Issues Open access
Journal Impact FactorTM (2022) 1.7
Journal Citation IndicatorTM (2022) 0.42
Received: 2022-09-18  |  Accepted: 2022-12-07  |  Published: 2022-12-30

Title

Stock price trend of selected companies applying the principles of circular economy


Abstract

This paper aims to establish whether there is a relationship between applying the circular economy (CE) principles and the stock prices of selected companies. In addition, a market capitalization change of the companies over ten years since the implementation of CE principles. Correlation analysis and comparison methods are used for this study. The results show that the application of CE principles does not adversely impact the selected companies' stock prices. This finding can help companies to determine whether they should implement these sustainability principles into their corporate cultures. Furthermore, it was established that the business development of the selected companies over the ten years since the implementation of CE principles had been positive for all studied entities but varied considerably. However, it needs to be clarified whether the application of CE principles is responsible for this positive trend. It would be useful to extend this research with further studies.


Keywords

stock, stock price, circular economy (CE), market capitalization, trend/development


JEL classifications

M21


URI

http://jssidoi.org/jesi/article/1036


DOI


Pages

448-463


Funding

This research was supported by the project, which has received funding from the Institute of Technology and Business. Grant Number IVSUZO001 “Benchmark of the world economy in the context of the principles of the circular economy and determining the value of the company“.

This is an open access issue and all published articles are licensed under a
Creative Commons Attribution 4.0 International License

Authors

Horák, Jakub
Institute of Technology and Business in České Budějovice, České Budějovice, Czech Republic https://www.vstecb.cz
Articles by this author in: CrossRef |  Google Scholar

Rousek, Pavel
Institute of Technology and Business in České Budějovice, České Budějovice, Czech Republic https://www.vstecb.cz
Articles by this author in: CrossRef |  Google Scholar

Opálka, Václav
Institute of Technology and Business in České Budějovice, České Budějovice, Czech Republic https://www.vstecb.cz
Articles by this author in: CrossRef |  Google Scholar

Journal title

Entrepreneurship and Sustainability Issues

Volume

10


Number

2


Issue date

December 2022


Issue DOI


ISSN

ISSN 2345-0282 (online)


Publisher

VšĮ Entrepreneurship and Sustainability Center, Vilnius, Lithuania

Cited

Google Scholar

Article views & downloads

HTML views: 1312  |  PDF downloads: 419

References


Škare, M., & Golja, T. (2013). How important are CSR companies for nations’ growth? Journal of Business Economics and Management, 14(4), 776-790. https://doi.org/10.3846/16111699.2013.820664

Search via ReFindit


Å kare, M., & Golja, T. (2014). The impact of government CSR supporting policies on economic growth. Journal of Policy Modeling, 36(3), 562-577. https://doi.org/10.1016/j.jpolmod.2014.01.008

Search via ReFindit


Aboulamer, A. (2018). Adopting a circular business model improves market equity value. Thunderbird International Business Review, 60(5), 765-769. https://doi.org/10.1002/tie.21922

Search via ReFindit


Ahmad, M., Ahmed, Z., Gavurova, B. & Oláh, J. (2022). Financial Risk, Renewable Energy Technology Budgets, and Environmental Sustainability: Is Going Green Possible? Front. Environ. Sci., 10, 909190. https://doi.org/10.3389/fenvs.2022.909190

Search via ReFindit


Aldieri, L., Brahmi, M., Bruno, B., & Vinci, C. P. (2021). Circular Economy Business Models: The Complementarities with Sharing Economy and Eco-Innovations Investments. Sustainability, 13(22). https://doi.org/10.3390/su132212438

Search via ReFindit


Łudzińská, K. (2017). Społeczna odpowiedzialność a wartość przedsiębiorstw na rynku kapitałowym. Problemy Zarzadzania, 15(1(66), 207-220. https://doi.org/10.7172/1644-9584.66.13

Search via ReFindit


Bae, J. C., Yang, X., & Kim, M. I. (2021). ESG and Stock Price Crash Risk: Role of Financial Constraints*. Asia-Pacific Journal of Financial Studies, 50(5), 556-581. https://doi.org/10.1111/ajfs.12351

Search via ReFindit


Behun, M., Gavurova, B., Tkacova, A., & Kotaskova, A. (2018). The impact of the manufacturing industry on the economic cycle of European Union countries. Journal of Competitiveness, 10(1), 23. https://doi.org/10.7441/joc.2018.01.02

Search via ReFindit


Biktimirov, E. N., & Afego, P. N. (2022). Do investors value environmental sustainability? Evidence from the FTSE Environmental Opportunities 100 index. Finance Research Letters, 44. https://doi.org/10.1016/j.frl.2021.102112

Search via ReFindit


Blinova, E., Ponomarenko, T., & Knysh, V. (2022). Analyzing the Concept of Corporate Sustainability in the Context of Sustainable Business Development in the Mining Sector with Elements of Circular Economy. Sustainability, 14. https://doi.org/10.3390/su14138163

Search via ReFindit


Capelle-Blancard, G., & Petit, A. (2019). Every Little Helps? ESG News and Stock Market Reaction. Journal of Business Ethics, 157(2), 543-565. https://doi.org/10.1007/s10551-017-3667-3

Search via ReFindit


Celebi, K., & Hönig, M. (2019). The Impact of Macroeconomic Factors on the German Stock Market: Evidence for the Crisis, Pre- and Post-Crisis Periods. International Journal of Financial Studies, 7(2). https://doi.org/10.3390/ijfs7020018

Search via ReFindit


Chehabeddine, M. R., Grabowska, S., & Adekola, A. F. (2022). Building a model for securing regional development from ecological threats. Insights into Regional Development, 4(2), 22-40. https://doi.org/10.9770/IRD.2022.4.2(2)

Search via ReFindit


Chen, H. -Y., & Yang, S. S. (2020). Do Investors exaggerate corporate ESG information? Evidence of the ESG momentum effect in the Taiwanese market. Pacific-Basin Finance Journal, 63. https://doi.org/10.1016/j.pacfin.2020.101407

Search via ReFindit


Corral-Marfil, J.-A., Arimany-Serrat, N., Hitchen, E.L., & Viladecans-Riera, C. (2021). Recycling Technology Innovation as a Source of Competitive Advantage: The Sustainable and Circular Business Model of a Bicentennial Company. Sustainability, 13, 7723. https://doi.org/10.3390/su13147723

Search via ReFindit


Corvellec, H., Stowell, A. F., & Johansson, N. (2022). Critiques of the circular economy. Journal of Industrial Ecology, 26(2), 421-432. https://doi.org/10.1111/jiec.13187

Search via ReFindit


Dartey-Baah, K., & Amoako, G. K. (2021). Global CSR, drivers and consequences: a systematic review. Journal of Global Responsibility, 12(4), 416-434. https://doi.org/10.1108/JGR-12-2020-0103

Search via ReFindit


de Dios-Alija, T., del Río Caballero, M., Gil-Alana, L. A., & Martin-Valmayor, M. (2021) Stock market indices and sustainability: A comparison between them. Journal of Sustainable Finance & Investment, 1-16. https://doi.org/10.1080/20430795.2021.1896988

Search via ReFindit


Demers, E., Hendrikse, J., Joos, P., & Lev, B. (2021). ESG did not immunize stocks during the COVID‐19 crisis, but investments in intangible assets did. Journal of Business Finance & Accounting, 48(3-4), 433-462. https://doi.org/10.1111/jbfa.12523

Search via ReFindit


Dimson, E., KarakaÅŸ, O., & Li, X. (2015). Active ownership. Review of Financial Studies, 28, 3225-32668. https://doi.org/10.1093/rfs/hhv044

Search via ReFindit


Du, S., Yu, K., Bhattacharya, C. B., & Sen, S. (2017). The Business Case for Sustainability Reporting: Evidence from Stock Market Reactions. Journal of Public Policy & Marketing, 36(2), 313-330. https://doi.org/10.1509/jppm.16.112

Search via ReFindit


Durand, R., Paugam, L., & Stolowy, H. (2019). Do investors actually value sustainability indices? Replication, development, and new evidence on CSR visibility. Strategic Management Journal, 40(9), 1471-1490. https://doi.org/10.1002/smj.3035

Search via ReFindit


Dvořáková, L., Horák, J., Caha, Z., Machová, V., Hašková, S., Rowland, Z., & Krulický, T. (2021). Adaptation of small and medium-sized enterprises in the service sector to the conditions of Industry 4.0 and Society 4.0: evidence from the Czech Republic. Economic Annals-XXI, 7-8, 67-87. https://doi.org/10.21003/ea.V191-06

Search via ReFindit


Eccles, R. G., Ioannou, I., & Serafeim, G. (2014). The Impact of Corporate Sustainability on Organizational Processes and Performance. Management Science, 60, 2835-2857. https://doi.org/10.1287/mnsc.2014.1984

Search via ReFindit


El Ouadghiri, I., Guesmi, K., Peillex, J., & Ziegler, A. (2021). Public Attention to Environmental Issues and Stock Market Returns. Ecological Economics, 180. https://doi.org/10.1016/j.ecolecon.2020.106836

Search via ReFindit


Engelhardt, N., Ekkenga, J., & Posch, P. (2021). ESG Ratings and Stock Performance during the COVID-19 Crisis. Sustainability, 13(13). https://doi.org/10.3390/su13137133

Search via ReFindit


Esken, B., Franco-Garcia, M. L., & Fisscher, O. A. M. (2018). CSR perception as a signpost for circular economy. Management Research Review,41(5), 586-604. https://doi.org/10.17221/343/2020-AGRICECON

Search via ReFindit


Flammer, C. (2013). Corporate social responsibility and shareholder reaction: The environmental awareness of investors. Academy of Management Journal, 56, 758-781. https://doi.org/10.5465/amj.2011.0744

Search via ReFindit


Gavurova, B., Megyesiova, S., & Hudak, M. (2021). Green Growth in the OECD Countries: A Multivariate Analytical Approach. Energies, 14, 6719. https://doi.org/10.3390/en14206719

Search via ReFindit


Guo, Y., Gou, X., Xu, Z., & Skare, M. (2022). Carbon Pricing Mechanism for the Energy Industry: A Bibliometric Study of Optimal Pricing Policies. Acta Montanistica Slovaca, 27(1), 49-69.

Search via ReFindit


Hasheminasab, H., Hashemkhani Zolfani, S., Kazimieras Zavadskas, E., Kharrazi, M., & Skare, M. (2022). A circular economy model for fossil fuel sustainable decisions based on MADM techniques. Economic Research-Ekonomska Istraživanja, 35(1), 564-582. https://doi.org/10.1080/1331677X.2021.1926305

Search via ReFindit


Havlínová, A., & Kukačka, J. (2021). Corporate Social Responsibility and Stock Prices After the Financial Crisis: The Role of Strategic CSR Activities. Journal of Business Ethics. https://doi.org/10.1007/s10551-021-04935-9

Search via ReFindit


Hawn, O., Chatterji, A. K., & Mitchell, W. (2018). Do investors actually value sustainability? New evidence from investor reactions to the Dow Jones Sustainability Index (DJSI). Strategic Management Journal, 39(4), 949-976. https://doi.org/10.1002/smj.2752

Search via ReFindit


Horák, J., & Katz, K. (2022). Operating lease as a means and motivation for circular economy. Ekonomicko-Manazerske Spektrum, 16(1), 114-124. https://doi.org/10.26552/ems.2022.1.114-124

Search via ReFindit


Ioannou, I. & Serafeim, G. (2015). The Impact of Corporate Social Responsibility on Investment Recommendations: Analysts’ Perceptions and Shifting Institutional Logics. Strategic Management Journal, 36, 1053-1081. https://doi.org/10.1002/smj.2268

Search via ReFindit


Kalinová, E. & Kostečková, D. (2022) Effectiveness of Just-In-Time principle in today's circular economy and its negative effect. Social and Economic Revue, 20, (1), 35-42. https://doi.org/10.52665/ser20220104

Search via ReFindit


Kang, M., Viswanathan, K. G., White, N. A., & Zychowicz, E. J. (2021). Sustainability efforts, index recognition, and stock performance. Journal of Asset Management, 22(2), 120-132. https://doi.org/10.1057/s41260-020-00202-0

Search via ReFindit


Khan, M., Serafeim, G., & Yoon, A. (2016). Corporate Sustainability: First Evidence on Materiality. Accounting Review, 91, 1697-1724. http://dx.doi.org/10.2139/ssrn.2575912

Search via ReFindit


Kovacs, I. (2021). Circular fashion from the perspective of young consumers – measurement and managerial relevance. Polish Journal of Management Studies, 24(2), 242-260. https://doi.org/10.17512/pjms.2021.24.2.15

Search via ReFindit


Krüger, P. (2015). Corporate goodness and shareholder wealth. Journal of Financial Economics, 115, 304-329. https://doi.org/10.1016/j.jfineco.2014.09.008

Search via ReFindit


Kristoffersen, E., Blomsma, F., Mikalef, P., & Li, J. (2020). The smart circular economy: A digital-enabled circular strategies framework for manufacturing companies. Journal of Business Research, 120, 241-261. https://doi.org/10.1016/j.jbusres.2020.07.044

Search via ReFindit


Lehmann, C., Cruz-Jesus, F., Oliveira, T., & Damásio, B. (2022). Leveraging the circular economy: Investment and innovation as drivers. Journal of Cleaner Production, 360. https://doi.org/10.1016/j.jclepro.2022.132146

Search via ReFindit


Machová, V., Krulicky, T. & Horak, J. (2020). Comparison of neural networks and regression time series in estimating the development of the afternoon price of gold on the New York stock exchange. Social and Economic Revue, 1, 61-72.

Search via ReFindit


Morea, D., Mango, F., Cardi, M., Paccione, C., & Bittucci, L. (2022). Circular Economy Impact Analysis on Stock Performances: An Empirical Comparison with the Euro Stoxx 50® ESG Index. Sustainability, 14(2). https://doi.org/10.3390/su14020843

Search via ReFindit


Morseletto, P. (2020). Targets for a circular economy. Resources, Conservation and Recycling, 153. https://doi.org/10.1016/j.resconrec.2019.104553

Search via ReFindit


Mynhardt, H., Makarenko, I., & Plastun, A. (2017). Market efficiency of traditional stock market indices and social responsible indices: the role of sustainability reporting. Investment Management and Financial Innovations, 14(2), 94-106. .2017.09 https://doi.org/10.21511/imfi.14(2)

Search via ReFindit


Naughton, J.P., Wang, C. & Yeung, I. (2019). Investor Sentiment for Corporate Social Performance. Accounting Review, 94, 401-420. https://doi.org/10.2308/accr-52303

Search via ReFindit


Novakova, L., Novotna, L., & Prochazkova, M. (2022). Predicted Future Development of Imperfect Complementary Goods – Copper and Zinc Until 2030. Acta Montanistica Slovaca, 27, 135-151. https://doi.org/10.46544/AMS.v27i1.10

Search via ReFindit


Odeh, M. H., Alshannag, F. M., Eneizan, B., Alkhawaldeh, A. M., Makhamreh, H. Z., & McMillan, D. (2020). Analysis of the relationship between corporate social responsibility (CSR) spending and market stock price among Jordanian service firms. Cogent Business & Management, 7(1). https://doi.org/10.1080/23311975.2020.1746732

Search via ReFindit


Oláh, J., Hidayat, Y. A., Gavurova, B., Khan, M. A., & Popp, J. (2021). Trust levels within categories of information and communication technology companies. PLOS ONE, 16(6), e0252773. https://doi.org/10.1371/journal.pone.0252773

Search via ReFindit


Raza, H., Gillani, S. M. A. H., Kashif, M. T., & Khan, N. (2021). The Impact of Corporate Social Responsibility on Share Price: A Systematic Review and Bibliometric Analysis. Studies of Applied Economics, 39(4). https://doi.org/10.25115/eea.v39i4.4311

Search via ReFindit


Sauvé, S., Bernard, S. & Sloan, P. (2016). Environmental sciences, sustainable development and circular economy: Alternative concepts for trans-disciplinary research. Environmental Development, 17, 48-56. https://doi.org/10.1016/j.envdev.2015.09.002

Search via ReFindit


Seroka-Stolka, O., & Ociepa-Kubicka, A. (2019). Green logistics and circular economy. Transportation Research Procedia, 39, 471-479. https://doi.org/10.1016/j.trpro.2019.06.049

Search via ReFindit


Simionescu, M., Strielkowski, W., & Gavurova, B. (2022). Could quality of governance influence pollution? Evidence from the revised Environmental Kuznets Curve in Central and Eastern European countries. Energy Reports, 8, 809-819. https://doi.org/10.1016/j.egyr.2021.12.031

Search via ReFindit


Stefko, R., Gavurova, B., Kelemen, M., Rigelsky, M., & Ivankova, V. (2021). Relationships between renewable energy and the prevalence of morbidity in the countries of the European union: a panel regression approach. International Journal of Environmental Research and Public Health, 18(12), 6548. https://doi.org/10.3390/ijerph18126548

Search via ReFindit


Su, K., & Zhou, Z. (2022). Do corporate social responsibility reduce crash risk of stock price: evidence from China. Chinese Management Studies. https://doi.org/10.1108/CMS-07-2021-0309

Search via ReFindit


Sumter, D., de Koning, J., Bakker, C., & Balkenende, R. (2020). Circular Economy Competencies for Design. Sustainability, 12(4). https://doi.org/10.3390/su12041561

Search via ReFindit


Sun, C., Zhang, Z., Vochozka, M., & Vozňáková, I. (2022). Enterprise digital transformation and debt financing cost in China?s A-share listed companies. Oeconomia Copernicana, 13(3), 783-829. https://doi.org/10.24136/oc.2022.023

Search via ReFindit


Utz, S. (2018). Over-investment or risk mitigation? Corporate social responsibility in Asia-Pacific, Europe, Japan, and the United States. Review of Financial Economics, 36(2), 167-193. https://doi.org/10.1016/j.rfe.2017.10.001

Search via ReFindit


Vochozka, M., Horak, J., Krulicky, T., & Pardal, P. (2020). Predicting future Brent oil price on global markets. Acta Montanistica Slovaca, 25(3), 375-392. https://doi.org/10.46544/AMS.v25i3.10

Search via ReFindit


Vui, Ch. S., Soon, G. K., On, CH. K., Alfred, R., & Anthony, P. (2013). A Review of Stock Market Prediction with Artificial Neural Network (ANN). In 2013 IEEE International Conference on Control System, Computing and Engineering. https://doi.org/10.3390/math8091441

Search via ReFindit


Wang, Y. -S., & Chen, Y. -J. (2017). Corporate social responsibility and financial performance: event study cases. Journal of Economic Interaction and Coordination, 12(2), 193-219. https://doi.org/10.1007/s11403-015-0161-9

Search via ReFindit


Xu, S., & Liu, D. (2018). Do Financial Markets Care about Corporate Social Responsibility Disclosure? Further Evidence from China. Australian Accounting Review, 28(1), 79-103. https://doi.org/10.1111/auar.12161

Search via ReFindit


Yu, W. X., Hassan, A., & Adhikariparajuli, M. (2022). How Did Amazon Achieve CSR and Some Sustainable Development Goals (SDGs)-Climate Change, Circular Economy, Water Resources and Employee Rights during COVID-19? Journal of risk and financial management, 15(8). https://doi.org/10.3390/jrfm15080364

Search via ReFindit


Zahedi, J., & Rounaghi, M. M. (2015). Application of artificial neural network models and principal component analysis method in predicting stock prices on Tehran Stock Exchange. Physica A: Statistical Mechanics and its Applications, 438, 178-187. https://doi.org/10.1016/j.physa.2015.06.033

Search via ReFindit