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PhD Program

PhD Dissertation Defense, Mingyi HUA, FINANCE

Hua Mingyi, HEC PhD Finance, 2022

Congratulations to Dr Mingyi Hua, Finance, who successfully defended her doctoral dissertation at HEC Paris on October 25, 2022. Dr Hua has accepted a position as assistant professor of finance, Ivey Business School - University of Western Ontario (Canada).

Visit Dr Hua's website

Specialization: Finance

Topic: Essays in Financial Economics

Supervisor: Thierry Foucault, Professor of  Finance, HEC Paris 

Jury Members:

  • Sébastien Pouget, Professor, Toulouse School of Management and Toulouse School of Economics
  • Julien Sauvagnat, Associate Professor, Bocconi University
  • Christophe Spaenjers, Associate Professor, HEC Paris
  • Thierry Foucault, Professor of  Finance, HEC Paris, Supervisor 

Abstract : 

This thesis contains three chapters which investigate how new developments affect financial outcomes. The first two chapters study digitalization within firms and the impact of being user-focused for these firms. The third chapter explores the phenomenon of ESG ratings for firms. The first chapter examines whether digitalization is priced in stock markets. I build a dynamic measure of digitalization that encapsulates a firm’s exposure to computers, data analytics, and programming. I find that this measure predicts stock returns beyond well-known predictors. This digital alpha is concentrated in firms which focus on users, where it averages 9.0% in annual realized excess returns over the past two decades. This figure likely compensates for risk, as user-focused digital firms have greater systematic risk. The second chapter focuses on these user-focused digital firms during the COVID-19 crisis. This setting is particularly suitable since the COVID-19 crisis catalyzed a shift from the offline world to the online world. I find that when firms are more digital, being userfocused drives increased search interest to these firms in the months following COVID-19’s arrival, which translates into better real performance through higher return on assets. Correspondingly, these firms experience relatively higher abnormal stock returns during this period. In the third chapter, I document that upwards of 40% of public firms in the U.S. do not have any ESG scores. Smaller or more financially constrained firms are less likely to receive scores. Firms which receive ESG scores for the first time enjoy higher employment, sales, and investment, as well as lower leverage and financial constraints. Hence ESG scores act as a club where new membership brings benefits.

Keywords : Digitalization, users, Google search, ESG