8.
Which of the following statements does not include an incorrect element?
a. As a consequence of SRI fund activism, there is no material change in accounting and operating performance, and there are no significant buy-and-hold returns or cumulative abnormal returns. Still, activism positively affect the ESG performance of targeted firms.
b. As a consequence of SRI fund activism, there is no material change in accounting and operating performance, and there are no significant buy-and-hold returns or cumulative abnormal returns. Still activism positively affect the ESG performance of targeted firms but mainly for those firms with poor ex ante ESG performance.
c. SRI fund activism affect the ESG performance of targeted firms: after being engaged by the activist, firms with low ex ante ESG performance experience an increase in ESG performance while the ESG performance of those with high ex ante ESG performance is not affected. In addition, the buy-and-hold returns of engaged firms are significantly positive whereas there is no positive effect on accounting performance.
Answer: c. SRI fund activism affect the ESG performance of targeted firms: after being engaged by the activist, firms with low ex ante ESG performance experience an increase in ESG performance while the ESG performance of those with high ex ante ESG performance is not affected. In addition, the buy-and-hold returns of engaged firms are significantly positive whereas there is no positive effect on accounting performance.