Sustainable Banking: A Closer Look at Scandinavian Banks´Sustainability Activities and Stock Market Performance

This thesis investigates announcements of sustainability news in major commercial Scandinavian banks and their effect on stock market performance by conducting a quantitative research method using a standard event study methodology. Two research questions are employed with the aim of firstly investigating if there is any relationship and secondly if the relationship differs between announcements of good news and bad news regarding sustainability. By analyzing events between 2007 to 2016, no statistically significant evidence for a relationship between announcements of sustainability news and stock market performance is found. This thesis finds statistically significant evidence that investors seem to respond positively to announcements of good sustainability news and no evidence for announcements of bad sustainability news. Hence, major commercial Scandinavian banks should focus on communicating those sustainability activities that have a positive effect on sustainability to their shareholders and other stakeholders