We note that last week automaker Volkswagen admitted that “’defeat devices’ used to cheat emissions testing were installed in 11 million vehicles worldwide.” The admission resulted in the swift “resignation and prompt replacement of CEO Martin Winterkorn, and a 30-percent drop in the company’s stock..” Volkswagen will be removed from the Dow Jones Sustainability Indices (DJSI) as of October 6 (showing, once again, just how unreliable these index measures are). Some time ago (2011), we quantified the impact environmental factors have on stock prices using several statistical techniques. Our analysis showed that investors and publicly traded companies must recognize the impact environmental incidents and issues have on a given firm's ability to use company assets and therefore generate revenue and profits. As we stated on February 5, 2015 in testimony to the Norwegian Ministry of Finance and on April 22, 2015 in testimony to the Government of the United Kingdom: “t
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