{"id":6233,"date":"2023-06-25T10:53:08","date_gmt":"2023-06-25T10:53:08","guid":{"rendered":"https:\/\/revista.isfin.ro\/?p=6233"},"modified":"2023-09-28T08:17:37","modified_gmt":"2023-09-28T08:17:37","slug":"means-and-agglomerative-hierarchical-clustering-analysis-of-esg-scores-yearly-variations-and-stock-returns-insights-from-the-energy-sector-in-europe-and-the-united-states","status":"publish","type":"post","link":"https:\/\/revista.isfin.ro\/en\/2023\/06\/25\/means-and-agglomerative-hierarchical-clustering-analysis-of-esg-scores-yearly-variations-and-stock-returns-insights-from-the-energy-sector-in-europe-and-the-united-states\/","title":{"rendered":"K-MEANS AND AGGLOMERATIVE HIERARCHICAL CLUSTERING ANALYSIS OF ESG SCORES, YEARLY VARIATIONS, AND STOCK RETURNS: INSIGHTS FROM THE ENERGY SECTOR IN EUROPE AND THE UNITED STATES"},"content":{"rendered":"
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Authors: \u0218tefan Rusu , Marcel Ioan Bolo\u0219, Marius Leordeanu<\/p>

Vol. 8 \u2022 Special Issue \u2022 June 2023<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t

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\n\t\t\t\t\t\n\t\t\t\t\t\tView abstract PDF\t\t\t\t\t<\/a>\n\t\t\t\t<\/h6>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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Abstract<\/strong><\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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This study employs k-means clustering and agglomerative hierarchical clustering techniques to visually examine the potential relationship between Environmental Social and Governance (ESG) scores, their year-over-year variations, and annual stock returns for a sample of 34 energy sector companies operating in Europe and the United States. While the agglomerative hierarchical clustering dendrogram suggests two clusters, the elbow method of the k-means algorithm suggests 2-4 clusters. The results indicate that neither ESG scores nor their year-on-year variations had an impact on the annual returns of the stocks. The conclusion is further confirmed by the Pearson correlation coefficient. However, the ESG scores of European energy companies show a tighter dispersion and smaller year-over-year change, making them more predictable ESG score-wise and thus, potentially, more attractive to ESG-driven investors.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Keywords:<\/strong> Stock market, clustering, ESG, machine learning, k-means clustering, agglomerative hierarchical clustering.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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JEL Classification:<\/strong>C38; G10; G11, Q50.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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DOI: <\/strong>10.55654\/JFS.2023.SP.11
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Authors: \u0218tefan Rusu , Marcel Ioan Bolo\u0219, Marius Leordeanu Vol. 8 \u2022 Special Issue \u2022 June 2023 View article PDF View abstract PDF Abstract This study employs k-means clustering and agglomerative hierarchical clustering techniques to visually examine the potential relationship between Environmental Social and Governance (ESG) scores, their year-over-year variations, and annual stock returns for …<\/p>\n

K-MEANS AND AGGLOMERATIVE HIERARCHICAL CLUSTERING ANALYSIS OF ESG SCORES, YEARLY VARIATIONS, AND STOCK RETURNS: INSIGHTS FROM THE ENERGY SECTOR IN EUROPE AND THE UNITED STATES<\/span> Read More »<\/a><\/p>","protected":false},"author":6,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[179],"tags":[],"yoast_head":"K-MEANS AND AGGLOMERATIVE HIERARCHICAL CLUSTERING ANALYSIS OF ESG SCORES, YEARLY VARIATIONS, AND STOCK RETURNS: INSIGHTS FROM THE ENERGY SECTOR IN EUROPE AND THE UNITED STATES - Revista de Studii Financiare<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/revista.isfin.ro\/en\/2023\/06\/25\/means-and-agglomerative-hierarchical-clustering-analysis-of-esg-scores-yearly-variations-and-stock-returns-insights-from-the-energy-sector-in-europe-and-the-united-states\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"K-MEANS AND AGGLOMERATIVE HIERARCHICAL CLUSTERING ANALYSIS OF ESG SCORES, YEARLY VARIATIONS, AND STOCK RETURNS: INSIGHTS FROM THE ENERGY SECTOR IN EUROPE AND THE UNITED STATES - 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