Non-Governmental Organization (NGO) Tweets: Do Shareholders Care?

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Publication Details

Output type: Journal article

UM6P affiliated Publication?: Yes

Author list: Dupire, Marion; Filbien, Jean-Yves; M'Zali, Bouchra

Publisher: SAGE Publications (UK and US)

Publication year: 2021

Journal: Business and Society (0007-6503)

Number of pages: 38

ISSN: 0007-6503

eISSN: 1552-4205

Languages: English (EN-GB)

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We study how messages on Twitter by large non-governmental organizations (NGOs), targeting companies from the S&P500, affect these companies' stock prices. With a sample of 1,611 tweets between 2009 and 2017 by 18 large NGOs, we observe significant changes in the stock prices of the targeted firms. More specifically, NGO tweets stating a positive message about the environmental, social, or governance (ESG). Actions of the firm have a positive effect on stock prices, while negative tweets have a negative effect. Nevertheless, we find that the presence of institutional owners hampers this effect: firms with high institutional ownership value positive tweets more negatively, and negative tweets more positively. These results support the idea that shareholders react significantly to NGO tweets but they react differently depending on their time horizon: for shareholders who have a more short-term horizon, typically institutional owners, the reaction diverges societal expectations about how firms should contribute to society.


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Last updated on 2021-15-06 at 23:16