Identifying Key Financial, Environmental, Social, Governance (ESG), Bond, and COVID-19 Factors Affecting Global Shipping Companies—A Hybrid Multiple-Criteria Decision-Making Method

Abstract

The international shipping industry is the largest transportation system in the world. However, shipping stock prices were highly volatile during the 2020–2021 COVID-19 pandemic. The purpose of this study is to identify the causal relationships of the four dimensions (financial performance, bond financing, environmental, social, governance, and COVID-19) and 20 criteria affecting the sustainability of global shipping companies. The research scope includes a sample of nine listed international shipping companies accounting for 49% of the global market share with data collected from 2010 to 2020. Survey responses from 15 investment experts were also obtained. We applied a hybrid multiple criteria decision-making (MCDM) method integrating the Decision-Making Trial and Evaluation Laboratory (DEMATEL), analytic network process, and modified VlseKriterijumska Optimizacija I Kompromisno techniques to be the DANP-mV model to identify the causal relationships among the dimensions and criteria, providing ways of narrowing the performance gaps of shipping companies. The results indicate that financial performance is the main cause affecting COVID-19 and ESG practices. The ESG practices influence bond financing. The largest performance gaps across shipping companies include earnings per share (EPS), yield to maturity, corporate social responsibility (CSR), and timely delivery. The findings of this study suggest that shipping companies may focus on gross profit margin to improve EPS, term to maturity to enhance yield to maturity, social distancing policy to meet timely delivery, and the board size to enhance corporate social responsibility (CSR). The outcome of this study aids shipping companies in prioritizing their resources and investors in selecting shipping company stocks in response to COVID-19.