Environmental policies and the relationship of environmental policies with stock markets in G2o countries

Environmental issues have become one of the most concerning problems in today's world. The ongoing environmental problems have exposed countries, institutions, and organizations to various risks. In response, countries have developed various environmental policies to address these issues. It is possible to measure the performance of countries in implementing these environmental policies. Environmental indexes are suitable tools for measuring and evaluating a country's environmental performance. The Environmental Performance Index (EPI) is an index designed to measure the performance of countries and their relationship to stock markets. This index focuses on the effects of environmental pressures on stock markets. This study aims to explain the impact of inflation rate, interest rate, foreign direct investment, and stock market interactions on EPI in G20 countries during the 2006-2022 period using panel data methods. The analysis concludes that the Environmental Performance Index and inflation have a long-term positive and significant impact on stock markets, while foreign direct investment and interest rates exhibit long- term negative effects. Keywords: Environmental Performance Index (EPI), Stock Market, Panel Data Analysis