THE IMPACT OF CSR DISCLOSURE AND ESG PERFORMANCE ON FIRMS´INFORMATION ASYMMETRY

This dissertation investigates the impact of CSR disclosure and ESG performance on information asymmetry for 166 firms’ constituents of the main market indexes in Portugal, France, Germany, and the U.K for the years 2015-2019. The European market follows the Directive n. 2014/95/EU which makes it mandatory for some companies to disclose non-financial information. We have obtained data regarding CSR disclosure and ESG scores from the Thomson Reuters EIKON database and used the bid-ask spread as an indicator of information asymmetry. Our results suggest a negative relationship for CSR disclosure, but the statistic was not significant. Regarding the ESG scores, we have tested a global score that takes into consideration environmental, social, and governance and each factor separately. Our results, apart from the governance score, are statistically significant and indicate that ESG performance can reduce information asymmetry.