Corporate Resilience and Response During COVID-19

How institutional investor money flows and returns relate to a company’s response to a market crisis.

April 2020

COVID-19 has forced companies to respond swiftly to the pandemic and highlight their resilience to investors. Exploring how their actions affect stock performance, we found that companies seen as protecting employees and securing their supply chain experienced higher institutional money flows and less negative returns, especially when those practices garnered significant public attention. Firms that most prominently re-purposed their operations to provide in-demand solutions to the crisis experienced a significant positive impact on returns. This evidence challenges the notion that shareholder and employee interests are in conflict. It also suggests that corporate disclosure and media coverage play a significant role in how corporate responses to crisis management decisions could influence investor behavior and impact stock performance.