The effect of including in the corporate sustainability index on the financial performance of companies

BIST Sustainability Index started to be calculated as price and yield with the code XUSRD as of 4 November 2014. It is the index that includes companies traded on Borsa Istanbul and with high corporate sustainability performances. In order to be included in the index, three criteria must be completed: environmental, economic and social dimensions. The aim of this study is; Considering the situations of the enterprises included in the corporate sustainability index before they were included in the index, it is to address the change in their financial performance. For this reason, it is aimed to compare the effect of the Corporate Sustainability Index on businesses by considering the financial performances of 24 businesses that are regularly included in the corporate sustainability index between the years 2014-2020, between the years 2009-2014 and 2014-2020. The businesses included in the study consist of non-bank businesses included in the corporate sustainability index. In the research, the variables of Stock Return Rate, Return on Assets (ROA), Return on Equity (ROE), Net Profit Margin (NKM), Current Ratio (CO), Leverage Ratio, Asset Turnover, Price / Earning and Market Value / Book Value variables were used. Panel regression method was used as a research method. The research consists of two models. Model 1. It covers the 6 years before the companies are included in the index, and Model 2 covers the six years after the companies are included in the index. As a result of the research, Model 2 is examined, it is seen that in the panel regression method that can predict the stock return rate variable, the variables of Return on Equity (ROE), Asset turnover, and Market value / Book value have significant values in the estimation. Keywords: Corporate Sustainability Index, Financial Performance, Panel Regression Method