Trends in ESG Rating Changes Following Corporate Risk Incidents

The purpose of this research is to understand how environmental, social, and governance (ESG) ratings have evolved over the past decade. To explore the proposed research question, this thesis will discuss the history of ESG, determine the current state of ESG ratings, and study the change in ESG ratings over the past decade. Through an analysis of ESG rating changes following a corporate risk incident, this paper will determine if ESG ratings have become more sensitive to risk incidents over the past eight years. Increased emphasis on the topic has led to an increase in public awareness about the importance of ESG. Based on the research, it has been found that ESG ratings have become more sensitive to corporate risk incidents in recent years, as larger changes in ESG ratings have been found following these risk incidents.