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We compile a novel data set on mandatory environmental, social, and governance (ESG) disclosure around the world to analyze the stock liquidity effects of such disclosure mandates. We document a positive effect of ESG disclosure mandates on firm-level stock liquidity. The effects are strongest if the disclosure requirements are implemented by government institutions, not on a comply-or-explain basis, and coupled with strong enforcement by informal institutions. Firms with weaker information environments benefit more from ESG disclosure mandates. Our results support the view that ESG disclosure regulation improves the information environment and has beneficial capital market effects.

We study the impact of an urban land titling program on firm investment in Shenzhen, China. We find that this program increased the investment rate for titling firms, but this positive effect only holds for politically connected firms. Further analysis suggests that the titling effect is more pronounced for those titling firms associated with greater expropriation risk. During program implementation, the connected titling firms increased their investment perhaps because, as observed, they experienced fewer disputes than non-connected titling firms.

Credit default swaps (CDSs) are a major financial innovation related to debt contracting. Because CDS markets facilitate bad news being incorporated into equity prices via cross-market information spillover, CDS availability may curb firms’ information hoarding. We find that CDS trading on a firm’s debt reduces the future stock price crash risk. This effect is stronger in active CDS markets, when the main lenders are CDS market dealers with securities trading subsidiaries, or when managers have more motivation to hoard information. Our findings suggest that debt market financial innovations curtail the negative equity market effects of firms withholding bad news.

Employee treatment is an important but challenging element of corporate environmental, social, and governance policies. Satisfying employee needs can increase corporate productivity, but is also costly to shareholders. Using unique data of Chinese publicly listed firms, we show that having satisfied employees is valuable to the firm. Specifically, firms with higher employee satisfaction scores withstand COVID-19 better, in terms of stock market performance. Such an effect is more pronounced for firms with more intangible assets and in knowledge-based industries. Moreover, higher employee satisfaction scores predict better operating performance. While not fully revealed in tranquil times, the effect of employee satisfaction is materialized when the firms experience negative shocks, such as COVID-19. Our findings suggest that firms can do well in crisis periods by doing good in normal times.

內地刺激經濟政策陸續出台，帶動A股及港股上周五表現向好。港大經管學院金融學教授湯勇軍（圖）早前接受訪問時表示，外國投資者購買內地A股並不多，但實際上內地股票有很多好處值得他們考慮，由於A股市場與全球股票市場的關連性較低，受國際金融危機的影響比其他主要經濟體都要小，因此若將A股納入國際投資組合，便會提高其夏普比率(反映衡量風險與回報的指標)，數目越高回報越好。

Punitive sanctions incurred by President Vladimir Putin’s invasion of Ukraine are leaving Russia economically isolated. Speaking on Feb. 24, the day of the incursion, U.S. president Joe Biden announced measures that “exceed anything we’ve ever done.”

《粵港澳大灣區發展規劃綱要》提到將香港打造成為區內綠色金融中心，港府也承諾將致力爭取於2050年前實現碳中和。事實上，港府近年銳意發展綠色金融，迄今累計發行綠色債券總值已逾3000億元，未來5年更計劃再發行多1700億元綠債。經濟學家看好前景，預期未來幾年本港有望發展成為區內綠色金融重鎮。

A research by Professor Dragon Youngjun Tang, Professor in Finance at HKU Business School and other co-authors discovers that banks using CDS for capital relief have effectively freed up extra capital for businesses, but at the same time are more likely to extend loans and build up riskier loan portfolios.

信用違約互換(CDS)被視為2008年金融海嘯的「元兇」之一，香港大學經管學院金融學教授湯勇軍表示，監管機構應對CDS作更多規管，若監管機構落後於金融創新，將會帶來社會後果。