Does Environmanetal, Social and Governance score affect investors behaviour in fossil fuel sector

Investors being more aware of risk that comes with investing in different companies. History shows dangers that come with investing, with market crushes through the years for different reasons. One of the metrics used to see whenever company shares are good asset to investors portfolio is called ESG (Environmental, Social and Governance. It is a widely used system in which third party company does an analysis of a company and report on a scale 0-100, how responsible company is on above mentioned factors. Fossil fuel companies being ones of the most polluting ones in the world are year by year investing more resources to become cleaner and more responsible. Some of the companies are using more resources to the cause and others are using less. Ones that use more resources to be more responsible companies should appeal to the investors more than ones that use less resources. Quantitative and deductive approaches have been selected to complete this research, data has been collected on volumes and prices of selected companies which operate in a fossil fuel sector. Time frame of data is 3 years and ESG scores as of which it was in 2020. All the companies are public and available for trade. Data analysis should show, whenever companies with higher ESG score have a higher volatility and visible development over the years in volumes. Hypothesis suggests that companies with higher ESG scores have a more positive development in their volumes over the years as well as companies with low ESG score should decrease in volumes over the years. Results is analysis showed that there is no visible development in stock volatility of a companies with higher ESG score from companies with lower one. Whenever it is useful for companies to invest resources in being more responsible was not able to be seen in this research. Data showed that over 3 years’ time volumes and prices of selected companies were very similar. Neither companies with highest ESG scores were the most tradable ones