Graduation Year
2023
Date of Submission
4-2023
Document Type
Open Access Senior Thesis
Degree Name
Bachelor of Arts
Department
Economics
Reader 1
Laura Grant
Terms of Use & License Information
Abstract
In response to growing dissatisfaction from environmental activists, many large institutional investors have committed to divesting from fossil fuel related assets. Understanding the financial effects of these divestment movements is crucial to assessing their impact on climate change. Using a financial event study methodology with a sample of 50 divestment announcements from 2014 to 2022, this paper examines the effect that the announcement of these divestment decisions has on the stock returns of oil & gas and coal companies. I find the short term effect on stock prices following a divestment announcement to be insignificant, and I show that more than divestment announcements are required to find a significant effect. Ultimately, I conclude that the effect of divestment announcements may be less tied to the day of the announcement, and the true effects may be found in the longer term.
Recommended Citation
Dale, Wesley, "Do Divestment Announcements Affect Fossil Fuel Company Stock Returns?" (2023). CMC Senior Theses. 3370.
https://scholarship.claremont.edu/cmc_theses/3370
