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The Value of Values: Does Focusing on Sustainability Provide a Competitive Advantage in Forecasting Earnings?

Salman Arif & Nargess M. Golshan

Contemporary Accounting Research2026https://doi.org/10.1111/1911-3846.70031article
FT50AJG 4ABDC A*
Weight
0.50

Abstract

We identify sustainability‐focused analysts using recent advances in machine learning combined with conference call transcripts. Sustainability‐focused analysts issue more accurate earnings forecasts, and the stock market reacts more strongly to their revisions. The forecasting advantage of sustainability‐focused analysts is amplified for material sustainability issues, small firms, and growth firms. Consistent with a learning curve in understanding how sustainability issues relate to future performance, we find that less experienced analysts are less likely to focus on sustainability and that they reap fewer benefits in forecast accuracy when they do so. Our results suggest that far from being an inefficient use of time and resources, focusing on sustainability provides a competitive advantage in one of the most pivotal steps in valuation: forecasting earnings.

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https://doi.org/https://doi.org/10.1111/1911-3846.70031

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@article{salman2026,
  title        = {{The Value of Values: Does Focusing on Sustainability Provide a Competitive Advantage in Forecasting Earnings?}},
  author       = {Salman Arif & Nargess M. Golshan},
  journal      = {Contemporary Accounting Research},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1111/1911-3846.70031},
}

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.