International ESG Supervision and the Stock and Crude Oil Nexus: Insights from the New Energy Industry
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As the business environment becomes increasingly uncertain, investors and firms are eager to analyze the patterns of financial market linkages from international rating information. This paper addresses this need by exploring how international ESG rating events impact the relationship between new energy stocks and crude oil prices. Using MSCI ESG rating events as a quasi-natural experiment, the study finds that these events significantly enhance the synchronicity between new energy stock prices and crude oil prices, and intensify herd-like behavior in new energy stocks linked to crude oil trading. The results are confirmed through various robustness tests. Mechanism analysis reveals that international ESG rating events strengthen the stock-crude oil nexus by reducing investor heterogeneous beliefs. This study provides a novel causal relationship between ESG information and the dynamics of financial markets, revealing the impact of international business sustainability ratings on the nexus between new energy market and crude oil market.
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