Investor Response to the Exxon Valdez Oil Spill

Author:White, Mark, McIntire School of CommerceUniversity of Virginia

This study examines the impact of the 1989 Exxon Valdez Oil spill on investment returns to shareholders in two different groups of firms: firms within the oil industry and a sample of unrelated firms with environmental reputation rankings. Within the oil industry, the effects of the spill were strongly negative and idiosyncratic to the exxon corporation. Within the sample of unrelated firms, companies with an exemplary reputation for environmentally responsible behavior earned significantly positive abnormal returns, while companies with neutral or negative environmental reputations showed no response. These latter findings support a proactive approach to corporate environmental management and endorse the role of corporations in achieving a sustainable society.

Exxon Valdez, investment returns, environment, corporate, shareholder
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Source Citation:

White, Mark. "Investor Response to the Exxon Valdez Oil Spill." University of Virginia Online Scholarship Initiative (1996).

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Sponsoring Agency:
University of Virginia Online Scholarship Initiative

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