This research evaluates the relationship between ESG score of the firm and its effect on

the performance of their bonds. The study looks at listed companies on the Nordic

countries

’ stock exchanges and tries to establish a relationship between ESG score and

corporate bond yield spread. The study finds that no such relationship can be established

and therefore that a high ESG score does not imply a decreased level of required risk

premium by bond investors and a decreased or stabilized cost of debt for companies in

the Nordic countries. Further, the study will contribute to a theoretical discussion by using

the Stakeholder Theory, Legitimacy Theory, The Resource-Based View and finally the

Agency theory in order to further analyze the underlying dynamics of this proposed

relationship.