The Capital Market Impact of Blackrock's Thermal Coal Divestment Announcement

Alexander Bassen, Thomas Kaspereit, Daniel Buchholz*

*Corresponding author for this work

    Research output: Contribution to journalJournal articlepeer-review

    11 Citations (Scopus)

    Abstract

    This study examines how coal companies were affected by the announcement of thermal coal divestment made by Blackrock, a large institutional asset manager. Following the announcement, the largest thermal coal mining companies exhibited negative abnormal returns. However, the stock prices of other firms were not affected. Blackrock's own share price increased following the announcement. We provide additional evidence that Blackrock protected its clients by lowering its exposure towards affected companies before the announcement. Overall, our results show that divestment has significant impacts on the companies in question and that the capital market sees divestment as value-enhancing for the divesting institution.

    Original languageEnglish
    Article number101874
    JournalFinance Research Letters
    Volume41
    DOIs
    Publication statusPublished - Jul 2021

    Scopus Subject Areas

    • Finance

    User-Defined Keywords

    • Divestment
    • Event Study
    • Thermal Coal

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