BIST Sustainability Index Research Articles

ARE INTELLECTUAL CAPITAL AND ITS COMPONENTS AFFECTIVE ON FINANCIAL PERFORMANCE?

The factors that affect intellectual capital creation at firms and how these factors influence the financial performance of firms have been core questions of extant work in the channels of finance for many years. In this period, therefore, the efforts that firms make to increase their intellectual capital to create value and studies that examine the impact of the increased intellectual capital on the firm’s financial performance are notable. Thus, this study aims to explore the influence of intellectual capital and its components on the financial performance of the BIST Sustainability Index companies for the period between 2018:Q4-2024:Q1. A set of Intellectual Value Added Coefficient (VAIC) and its components Human Capital Efficiency (HCE), Structural Capital Efficiency (SCE), and Capital Employed Efficiency (CEE) are employed as indicators of intellectual capital. The financial performance is measured through Return on Assets (ROA) and Return on Capital Employed (ROCE). Control variables included in each model are Market to Book Value (MV/BV), Logarithm of Total Assets (SIZE), and Asset Turnover (ATR). The fixed effects regression results show that an increase in the intellectual capital of the companies listed in the BIST Sustainability Index has a positive effect on their financial performance.

The Effect of ESG Data of Companies on Financial Performance: A Panel Data Analysis on The BIST Sustainability Index

The relationship between companies' environmental, social, and governance (ESG) data and their financial performance is of significant interest. The primary aim of this study was to investigate whether the ESG scores of companies in the BIST Sustainability Index impact their financial performance. By analysing the relationship between ESG scores and financial performance indicators of 26 companies, whose ESG scores were calculated by S&P Global for the period 2018-2022, using the panel data analysis method, we found compelling results. ESG factors were found to have a significant and positive effect on return on assets (ROA), return on equity (ROE), net profit margin (NPM), and asset growth (AGR) but a negative effect on the market-to-book ratio (MBR).

Financial Performance of BIST Sustainability Index Enterprises: Unearthing the Most Optimum MCDA Methods for Decision-Makers

Purpose: The aim of this study is to examine the financial performance of companies traded in BIST Sustainability index using 7 MCDA applications. Although there have been previous studies on aforementioned index, this study will be the first comparative and most comprehensive study conducted across 7 methods. Methodology: Analyzes were performed using VIKOR, FUCA, MOORA, GRA, COPRAS, SAW and CODAS methods and the CRITIC technique for the financial performance of 34 companies that achieved to remain in the relevant index continuously for 11 periods, within the timeframe spanning from Q1 2019 to Q3 2021. Findings: According to the comparative MCDA analysis, the highest capacity was found in the VIKOR method with 65.8% (p

Exploring the Impacts of Financial Failure Risk on Sustainable Growth Policies: Evidence from the BIST Sustainability Index Companies

This study investigates the impacts of financial failure risk on firms' sustainable growth policies using econometric analysis and aims to identify suitable financial failure models for the sustainable growth policies developing process. The study covers data from 38 non-financial firms listed in the Borsa Istanbul Sustainability Index (XUSRD) for 2010-2022. Sustainable growth is calculated by Higgins's (1977) sustainable growth rate (HSGR), while financial failure risks are assessed through Altman's (1983) Z'-score, Springate (1978) S-score, Taffler (1983) T-score, Fulmer et al. (1984) H-score and Legault (1987) CA-score models. The econometric approach employs a five-stage panel data methodology, including the pre-tests of multi-collinearity, cross-sectional dependency, slope homogeneity, stationarity, autocorrelation, and heteroskedasticity. Panel regression results reveal positive relationships between financial success and sustainable growth. However, the statistical significance of these relationships varies across different financial failure models. The effects of T and H-scores are statistically significant, whereas Z', S, and CA-scores do not exhibit statistically significant effects. Consequently, the findings suggest that T and H-score models should be prioritized in sustainable growth policy development.

Examining the sustainability performance of businesses in the BIST sustainability index in the context of sustainable development goals

Examining the sustainability performance of businesses in the BIST sustainability index in the context of sustainable development goals

A Research on the Impact of Carbon Emissions on Financial Performance of Companies in the Borsa Istanbul Sustainability Index

The goal of this study is to reveal the relationship between the amount of carbon emissions that firms emit into the atmosphere and financial performance of the firms. In this context, the data of 41 firms listed in the “Borsa Istanbul Sustainability Index” between 2017-2021 are examined. “Panel data analysis” methods were administered in the research. As consequences of the research, it is inferred that carbon emission intensity, size, leverage and growth variables have a significant impact on “Tobin’s Q Ratio and ROA”. Only the “growth” variable has a significant impact on “ROE”. However, the study shows that total carbon emission has no significant impact on “ROA, Tobin’s Q Ratio and ROE”. Limited research with in this content has been found in the national literature. Within this scope, the study is a pioneering research on determining the relationship between carbon emissions and financial performance of companies traded in the "BIST Sustainability Index" and is assessed to contribute to practitioners and the literature regarding the findings obtained.

The Effects of Natural Disaster on Financial Markets: The Empirical Analysis of 2023 Earthquakes in Türkiye

Purpose: The aim of the study is to investigate the effects of the February 6 earthquakes on financial markets Design/Methodology: BIST100 index, BIST sustainability index and BIST 100 electricity index were analyzed by the cross quantilogram method.. Findings: As a result of the analysis; According to the findings, the highest negative correlation values are seen in the period after the earthquake date. While the correlation relations between the sustainability and electricity indices included in the study and the BIST100 index were negative shortly before the earthquake, they followed a fluctuating course and maintained a negative effect since the earthquake date. In both indices, the dates when the negative effects are most visible coincide with the post-earthquake period. This situation reveals that both indices were negatively affected by the earthquake. Limitations: The fact that the February 6 earthquakes are still new and their consequences have not yet fully emerged necessitates the study to be conducted with more comprehensive data in the future. Originality/Value: It is thought that the study will make a significant contribution to the literature in terms of seeing short-term results and determining economic projections accordingly. Due to the devastating earthquakes that have occurred in recent years, the economic effects of natural events have become very important for Turkey. Therefore, it is inevitable to discuss the consequences of these effects and what needs to be done in the light of these consequences.

Evaluation of the Sustainability Messages of the Companies with the Highest BIST Sustainability Index on X (Twitter) Platform

BIST Sustainability Index was created to increase the understanding, knowledge, and practices on sustainability among Borsa Istanbul companies in Turkey. The BIST Sustainability Index aims to guide companies in the process of establishing policies regarding the environmental, social, and corporate governance risks of stock exchanges. In addition, it has the mission of creating a platform that communicates information on companies' sustainability policies to responsible investors. In line with the United Nations Sustainability Development Goals, several metrics are presented according to the sustainability practices of companies in Borsa Istanbul. Social networks are a tool that businesses frequently use to disseminate information quickly and at low cost. It has a key role in disseminating information about social marketing activities, especially in the sustainability axis. This study focuses on how companies use social networks to disseminate sustainability information. For this purpose, the sustainability messages of the 12 companies with the highest scores in the BIST sustainability index on the social network X platform for the years 2014-2022 are analyzed. The aim of the study is to examine whether there is a relationship between the companies' BIST sustainability index scores and the intensity of their use of sustainability messages on the social network. X platform data was obtained with the Python programming language, twint library. The correlation test was carried out using the SPSS package program with the Spearman Correlation test. As a result of the research, it is seen that the most frequently used keywords/phrase groups in the posts made by all companies are "education, energy, climate, women, health, water, sustainable, wages, production". The study did not find a significant relationship between the BIST sustainability index scores and the intensity of companies' messages containing sustainability keywords on the platform. This shows that companies should use social networks more efficiently in the dissemination of sustainability activities. Knowing how companies use social media to disseminate sustainability information can provide guidance for other companies. On the other hand, within the scope of the research, the messages of the companies were analyzed and the sustainability keywords were divided into three themes. The first theme is health, education, and women; the second theme is climate and environment; and the third theme is energy and savings. These themes and keywords are expected to serve as a source for content analysis studies such as social media messages and sustainability reports. Although no similar study has been found in Turkey, this study is one of the rare studies in the world literature. Unlike the literature, the sustainability activities on social media of the companies ranked at the top of the BIST Sustainability Index are analyzed. Thus, the activities carried out by companies that have already been determined to be successful in sustainability activities with a metric will serve as an example for companies that are not included in this list. On the other hand, the themes obtained from the research can be utilized in the dissemination of sustainability information on social media.

The Impact of Carbon Emissions on Corporate Cost of Debt (COD): A Research on Borsa İstanbul (BIST) Sustainability Index

This study examines the influence of carbon emissions of companies traded on the BIST Sustainability Index on the cost of debt for 2017-2021. In other words, the study aims to guide decision-makers towards carbon emissions reduction by showing a significant impact between the cost of debt and carbon emissions. The data were obtained from the Public Disclosure Platform, companies’ financial statements, annual reports, sustainability reports, integrated reports, and the DataStream database and were subjected to statistical analysis. Panel data pooled OLS method was used in the study. The study found a significant impact of total carbon emissions, carbon emission intensity, leverage, and structure variables on the cost of debt. However, it was concluded that the size, return on assets, growth, and cash flow variables did not significantly impact the cost of debt.

Analysis of the relationship between sustainability scores and financial performance of the companies in the BIST sustainability index

Purpose- The inclusion of companies in the BIST Sustainability Index and the disclosure of sustainability scores provide not only benefits in terms of making companies’ sustainability practices better known by stakeholders and the public, but also may increase stock returns. Therefore, this study aims to analyse the relationship between sustainability scores and financial performance of companies in the BIST Sustainability Index. Methodology- In order to analyse the relationship between the sustainability scores of 62 companies in the BIST Sustainability Index and their financial performances, the sustainability scores of the companies and the companies' firm value, return on assets and stock rate of return as the financial performance indicators is examined by multiple regression analysis method over the data of 2022. Findings- A negative relationship was found between the sustainability scores of the companies and the firm value, while no significant relationship was found between the sustainability scores and the other financial performance indicators, namely return on assets and stock rate of return. Conclusion- The reason for the negative relationship between the sustainability scores of the companies and the firm value may stem from the investors’ perception that the environmental investments to be made by the the company will increase the company's costs, which will have a negative impact on the company's financial statements and thus on the stock return. Keywords: Sustainability, sustainability scores, financial performance, multiple regression analysis. JEL Codes: E44, G11, G32

The Impact of Carbon Emissions on Firms’ Financial Performance: An Application in BIST Sustainability Index

The Impact of Carbon Emissions on Firms’ Financial Performance: An Application in BIST Sustainability Index

ANALYSIS OF THE VALIDITY OF TRADE-OFF AND PECKING ORDER THEORIES IN CAPITAL STRUCTURE DECISIONS OF SUSTAINABLE COMPANIES

In the study, it is aimed to test the validity of the Pecking Order Theory and Trade-Off Theory, which are among the theories on which the capital structure decisions of companies, which are extremely important in terms of firm value, are based, on sustainable companies included in the BIST Sustainability Index, since they carry out activities to reduce the cost of capital. In the study, the total indebtedness ratios, long-term indebtedness ratios and short-term indebtedness ratios of 40 companies included in the BIST Sustainability Index between 2015-2021, as well as liquidity, asset structure, non-debt tax shield, tax, profitability ratio, change in assets, firm size and the relationship between firm risk is examined. In general, the capital structure preferences of sustainable firms support the Trade-Off Theory. In addition, it was revealed that the dummy variable created for the periods when companies entered the BIST Sustainability Index was statistically significantly and positively related to their borrowing behavior. This result is interpreted in the direction of an increase in the borrowing rates of the companies after they are included in the index.

The Time-Varying Causality Relationship between Sukuk, BIST Sustainability Index and Government Bonds: The Case of Turkey

Finansal piyasalarda yatırımcıların bir kısmı finansal varlık seçimlerinde sadece getiri ve riskten korunma gibi temel fonksiyonları değil, yanı sıra inanç, etik, çevresel etki ve sorumlu yatırım ilkeleri gibi normatif boyutları da dikkate almaktadır. Portföy oluşturma sürecinde bir yandan inanç veya sorumlu yatırım ilkelerini gözetmeleri diğer yandan da risk-getiri tercihlerine ilişkin taşıdıkları kaygılar yatırımcıların varlık seçimlerini güçleştirmektedir. Bu bağlamda, çalışmada, Türkiye’de finansal araç olarak işlem gören Borsa İstanbul (BIST) sürdürülebilirlik endeksi, kamu ihraçlı kira sertifikası (sukuk) ve 10 yıllık devlet borçlanma senedi (devlet tahvili) arasındaki zamanla değişen nedensellik ilişkisini araştırmaktadır. Bununla beraber çalışma sürdürülebilir finans ile İslami finans arasındaki ortak noktalara değinerek sosyal sorumlu yatırım ilkelerini baz alan yatırımcıların varlık seçeneklerini artırabileceklerine dikkat çekmektedir. Bu katkılar çalışmanın önemini oluşturmaktadır. Ampirik analizinde kullanılan veriler 2016-2020 dönemini kapsayan günlük verilerdir. Bulgulara göre, BIST sürdürülebilirlik endeksi ile kira sertifikası (sukuk) arasında iki yönlü, BIST sürdürülebilirlik endeksi ile devlet tahvili arasında tek yönlü (BIST sürdürülebilirlik endeksinden devlet tahviline), devlet tahvili ile kira sertifikası arasında iki yönlü zamanla değişen Granger nedensellik ilişkisi tespit edilmiştir. Buna göre, ele alınan varlıklar arasındaki dinamik ilişkinin, yatırımcılara fiyat kestirimi yaparken faydalı bilgiler sağlayacağı düşünülmektedir.

Sürdürülebilirlik Raporlaması ve Firma Performansı: BIST Sürdürülebilirlik Endeksi Üzerine Bir Uygulama

Dünyada yaşanan teknolojik gelişmelerin üretim sektöründeki yansımaları sonucunda doğaya verilen zarar kaynaklı küresel bilinç yıllar içinde artış göstermiştir. Firmalar, ekonomik rapor hazırlamak dışında, sosyal ve çevresel raporları içeren sürdürülebilirlik raporu hazırlamaya başlamıştır. Gelinen noktada paydaşlar firmaların sadece finansal verilerini değil sürdürülebilirlik faaliyetlerini de bu raporlar aracılığıyla takip etmek istemektedir. Yapılan araştırmalar, sürdürülebilirliğe önem veren firmaların yatırımcılar tarafından değerli görüldüğünü göstermektedir. Bu durum sürdürülebilirlik raporlaması ile firma performansı arasındaki ilişkiye etki eden araştırmaları artırmıştır. Bu çalışmanın amacı, firmaların finansal performans göstergelerinin sürdürülebilirlik raporu yayınlamada etkisinin olup olmadığını ampirik olarak incelemektir. Finansal performans göstergesi olarak Aktif Karlılık Oranı, Özkaynak Karlılık Oranı, Net Kar Marjı, Büyüklük ve Finansal Kaldıraç değişkenleri kullanılmıştır. Çalışmada BIST Sürdürülebilirlik Endeksi’nde yer alan 44 firmanın 2014-2021 yılları arasındaki 351 firma/yıl verisi kullanılmıştır. Finansal performans göstergelerinin sürdürülebilirlik raporu yayınlamada etkisi bağımlı değişkenin kategorik olduğu durumlarda başvurulan lojistik regresyon yöntemi ile analiz edilmiştir. Elde edilen sonuçlar, finansal performans göstergelerinden büyüklük dışındaki değişkenlerin anlamlı etkisinin olmadığını ancak firmaların finansal büyüklüğü arttıkça sürdürülebilirlik raporu yayınlama eğiliminde olduklarını göstermektedir.

Analysis of Dynamic Connectedness Relationships among Clean Energy, Carbon Emission Allowance, and BIST Indexes

Understanding and examining energy markets correctly is crucial for stakeholders to attain maximum benefit and avoid risks. As a matter of fact, the volatility that occurred in energy markets and recent crises had major impacts on national economies. Dynamic connectedness relationships (DCRs) can make quite powerful predictions for both low-frequency data and limited time-series data. The objective of this study is to explicate the dynamic connectedness relationships among the BIST sustainability index, BIST 100 index, S&P Global Clean Energy index (S&P GCEI), and S&P GSCI carbon emission allowances (EUA). The daily data obtained over the period 11 April 2014–11 November 2022 were used for the research study. The DCRs among the variables used in the study were investigated by employing the time-varying parameter vector autoregressive (TVP-VAR) model. As a result of the study, the volatility from carbon emission allowances was determined to spill over to S&P GCEI, BIST 100, and BIST sustainability indexes. During the COVID-19 pandemic, significant reductions were detected in the volatility spillover (VS) from carbon emission allowances to S&P GCEI, BIST 100, and BIST sustainability indexes. Moreover, it was revealed that a weak VS existed from S&P GCEI to BIST sustainability and BIST 100 indexes. The findings reveal the importance of policymakers taking some incentive measures in EUA prices and also its role in portfolio diversification.

OTOMOTİV FİRMALARININ ENDÜSTRİ 4.0 ÖNCESİ VE SONRASI FİNANSAL PERFORMANSLARININ ANALİZİ: BİST SÜRDÜRÜLEBİLİRLİK ENDEKSİ'NDE BİR UYGULAMA

Today, the "Industry 4.0 revolution", which offers opportunities such as a substantial competitive advantage, increase in production capacity, and cost reduction, is preparing to move institutions to a rapidly changing information age. Therefore, the importance of keeping up with innovations and providing sustainable performance is increasing for businesses in this age. On the other hand, it draws the attention of researchers to whether there is a difference between the financial performances of companies before-after industry 4.0. The study compares the financial performances of automotive companies that have adopted Industry 4.0 methods in the BIST Sustainability Index, before and after Industry 4.0. For this purpose, the companies' financial performances were analyzed and compared between 2013-2015 and 2016-2018 with the Gray Relational Analysis method, one of the multi-criteria decision-making techniques. The entropy which is an objective method, was preferred for weighting the criteria. Ten financial ratios were used as criteria in the performance evaluation. As a result, almost all companies increase their financial performance, but a decrease occurs only in one company's financial performance with the transition to Industry 4.0. So it can be stated that the increase in the share of R&D expenditures and Industry 4.0 investments will positively affect the financial performance of companies.

Content Analysis of the Environmental Dimension of Sustainability Reports of Companies in the BIST Sustainability Index

Bireyler ve kuruluşlar kendi ihtiyaç ve istekleri uğruna dünyanın yer altı ve yer üstü kaynaklarını tüketerek hem gelecek nesillerin hem de dünyanın devamlılığını ve sürdürülebilirliğini yok edebilmektedirler. Bu nedenle de ister devlet ister şirket olsun bütün ekonomik birimlerin faaliyetlerinin çevresel ve sosyal etkilerinin sınırlandırılması fikri ve uygulamaları giderek önem kazanmaktadır. Borsa İstanbul’daki (BIST) şirketler arasından sürdürülebilirlik performansı yüksek olanlar Sürdürülebilirlik Endeksi’nde yer almakta ve sürdürülebilirliğe ilişkin faaliyetlerini her yıl gönüllü bir şekilde kamuya sürdürülebilirlik raporlarıyla açıklamaktadırlar. Bu çalışmada 2018 – 2019 ve 2020 – 2021 dönemlerinde BIST Sürdürülebilirlik Endeksi’nde yer alan 38 şirketin sürdürülebilirlik raporları aracılığıyla, çevresel sürdürülebilirliğe ilişkin uygulamaları ve açıklamaları incelenmiş, ifadelerin kullanımları şirketler ve sektörler açısından karşılaştırılmıştır. Çalışma kapsamında belirlenen 41 çevresel bildirim ifadesinin kullanımına ilişkin yapılan içerik analizinin sonuçlarına göre; her iki dönemde de çevre ve iklim en fazla kullanılan ifadeler olduğu gözlenmiştir. 2018 – 2019 döneminde toprak kirliliği, görüntü kirliliği, gürültü kirliliği ve 2020 – 2021 döneminde atık kontrolü, toprak kirliliği en az kullanılan ifadeler olurken çevre denetimine ve yeşil finansa hiç yer verilmemiştir. Ayrıca her iki dönemde de sektörel bazda holding ve yatırım şirketleri ile bankalar en fazla, bilişim ve savunma sektörleri en az ifadeye yer vermiştir. Karşılaştırma sonucunda genel olarak ifade kullanımlarının giderek arttığı, ifadelerin sıklığının ve öneminin değiştiği, bazılarının ise sonraki dönemde hiç kullanılmadığı görülmüştür.

Financial Performance Evaluating and Ranking Approach for Banks in Bist Sustainability Index Using Topsis and K-Means Clustering Method

The purpose of this study is to identify, analyze, and evaluate the differences between banks in the Borsa İstanbul (BIST) Sustainability Index and other banks based on their financial performance. This study employs an approach based on a technique for order of preference by similarity to an ideal solution to evaluate and rank 46 Turkish banks with an evaluation framework consisting of 11 financial ratios between 2015 and 2019. The entropy, equal weight, standard, and variance methods were adapted to determine the weights of the financial ratios. Ultimately, the closeness coefficients of the banks derived from the four different weighted TOPSIS methods assist in identifying the positions of banks within other banks using K-means clustering analysis. However, this analysis has two main drawbacks. One is to determine the value of k and the other is to select the initial centers. The Calinski-Harabsz Index (CHI) was used to determine the validity of k. To solve the initial center drawback, we ran the clustering algorithm for all combinations of initial centers from the dataset. CHI is again used to determine which cluster group, derived from a different initial center, is more accurate. Finally, we present the results obtained by using this process for a set of 46 banks.
 
 Received: 20 September 2022 / Accepted: 26 December 2022 / Published: 5 January 2023

Evaluation of Corporate Sustainability Reports: Sustainability Research in the Turkish Banking Sector

The aim of this thesis study is to ensure the sustainability of the Turkish banking sector by considering the environmental, economic and social effects of different practices still existing in human rights, working conditions, management structure, health, safety, education, governance, energy consumption and financial functions of banks operating in Turkey. For this purpose, the corporate sustainability performance of the banks operating in Turkey and included in the BIST sustainability index, published between 2017-2019, is measured in comparison with the multidimensional corporate sustainability approach and evaluated according to the measurement results. Thus, it will be possible to determine how much the banks that have adopted the corporate sustainability approach have developed their corporate sustainability understanding and the level they have reached. It is very important to reveal the economic, environmental and social effects of banks operating in Turkey, which voluntarily accept to be included in the BIST sustainability index, due to the ability of banks to influence and even direct all sectors. In addition, data that are not included in the reviewed sustainability reports but are expected to be disclosed will also be specified. The corporate sustainability performance of the banks, which are the subject of the review, was evaluated using the TOPSIS method, which is one of the multi-criteria decision-making methods.

A Research on the Effects of Sustainability Reports Published in the Banking Sector on Financial Performance

In studies comparing sustainability performance and financial performance, it is seen that banking is generally excluded from the sample. The main purpose of this study is to analyze the effect of the statements made within the scope of the sustainability report in the banking sector on the financial performance of banks. 9 banks that were included in the BIST Sustainability Index at least once between 2010 and 2020 were included in the analysis. Environment, human resources, product responsibility and society as areas of sustainability; Return on assets and equity and net interest margin were determined as financial performance criteria. In the study, in which non-parametric statistical tests and Panel data analysis were used, public-private status and bank sizes were used as dummy variables. As a result, it has been found that the sustainability report disclosures have a significant effect only on the return on assets, while the sustainability report disclosures do not have a significant impact on the return on equity and net interest margin. In addition, when the effect of the sustainability report disclosures on the profitability of assets is examined in terms of its dimensions, it has been determined that the statements made regarding the environmental and human resources dimensions have a negative effect on the return on assets.