The impact of sustainable practices on the financial performance of stocks in IPOs: A literature review (REUNIR Revista de Administração Contabilidade e Sustentabilidade)

Summary

• The analysis confirms Lotka's Law, finding that 2.47% (2 out of 81) of authors published 3 articles, 6.17% (5 out of 81) published 2 articles, and 91.36% (74 out of 81) published a single article.p.13
• Bradford's Law reveals high journal concentration, where 4 journals in Zone 1 accounted for 11 out of 33 articles (33.33%), led by Research in International Business and Finance with 4 articles.p.11
• Geographic analysis indicates that China leads in publication volume and international collaboration (3 multiple country publications), followed by Australia and the UK.p.12
• The systematic review finds that 57.58% of the analyzed studies report a positive relationship between sustainable practices and stock financial performance during an IPO, while 9.09% report a negative relationship.p.16
• Regarding empirical methods, panel data regression (36.36%) and cross-sectional regression (21.21%) are the most frequently applied, whereas event studies account for only 3.03%.p.15

Key insights

1. Underpricing is the primary short-term metric evaluated in IPO financial performance, historically recorded at an average discount of 11.4% between 1960 and 1969 by Ibbotson.p.4
2. The Journal of Corporate Finance is the most cited journal among the sample, receiving 114 global citations.p.11
3. A major portion of empirical studies (48.48%) focuses on company data from Asia and Oceania, limiting cross-regional generalization to regions such as Latin America and Africa.p.16
4. Overall ESG scores are used as the primary independent variable in 45.45% of the literature, whereas individual submetrics like green patents or emission reduction initiatives appear in only 6.06% of studies.p.15
5. The theoretical framework of the analyzed literature relies heavily on Agency Theory (21.21%), Information Asymmetry (15.15%), and Shareholder Theory (9.09%).p.14
6. A major gap in future research lies in investigating the authenticity of corporate sustainability disclosures to examine potential greenwashing during IPO processes.p.19