Niklas Bussmann – University of Pavia

Alessandra Tanda – University of Pavia

Ellen Pei-yi Yu – Birbeck

Can ESG Shape Cost of Capital? A Bibliometric Review and Empirical Analysis Through ML https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4173890

The paper employs AI methodologies to explain the impact of ESG behaviour on the cost of capital. Starting from the awareness of the increased interest by the literature and the market in understanding how ESG behaviour of companies enters the determination of companies’ evaluation and riskiness, this paper firstly reviews previous empirical studies in the field through a bibliometric tool and secondly, applies the XGBoost algorithm and a Shapley value approach to a sample of more than 1400 multinational companies listed located worldwide.