Date of Award

Spring 2023

Degree Name

Bachelor of Science (BS)

Advisor(s)

Eun-Hee Kim

Abstract

The popularization of the #MeToo movement in 2018 has brought the widespread issue of sexual assault to the forefront of the minds of the public. As accusations of sexual assault are released against high-level executives at some of the world's largest companies, one can wonder if the public condemnation of these actions is extended to investors and their decisions. This paper aims to discover if companies sustain a financial loss when accusation against an executive at a company is made public. The observed company was compared to a comparable company of a similar industry and observed for any changes in stock price. I found that investors did present an initial negative reaction to the news; however, this negative sentiment is not always sustainable. Many companies' stock price returns to be in accordance with the market after a few days. The findings suggest that while society may condemn these acts, investors are not too quick to make a major, sustainable changes in their strategies, even if the accused remains in his position. If study were to be replicated, I would suggest building out the event study to establish a stronger market similarity and strengthen the conclusions drawn from the comparisons.

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