Aug 2026· Corporate Social Responsibility and Environmental Management· 0 citations· 112 references
Abstract
In view of China's “dual carbon goals” (carbon neutrality and carbon peaking), the mechanisms and boundary conditions that form the basis of the relationship between corporate environmental, social, and governance (ESG) performance and financial performance have not been adequately explored. Using data on Chinese A‐share listed firms from 2010 to 2024, this study investigates the mediating role of green innovation in the association between corporate ESG performance and financial performance. Then, we examine the impact of corporate ESG practices on financial performance at varying levels of financial risk, adding consideration of financial risk. Our empirical results indicate that good ESG performance significantly enhances financial performance; however, this relationship is moderated by the level of financial risk. Our heterogeneity analysis reveals that non–state‐owned enterprises, firms with high‐quality information disclosure, and small firms benefit more from ESG‐driven green innovation. This study clarifies the pathways and boundaries of ESG‐driven value creation, enriches the literature on sustainable finance, and provides empirical guidance for enterprises engaged in a low‐carbon transition.
Against the backdrop of China’s “dual carbon” strategy and green transformation, this study examines the impact of green investment on corporate financial performance and the moderating role of state-owned shareholding ratio. Using a sample of Chinese A-share listed manufacturing firms from 2014 to 2023 and adopting a dynamic panel data model, the empirical results show that green investment significantly improves corporate financial performance. Moreover, state-owned shareholding plays a negative moderating role, and high state ownership weakens the positive effect of green investment on financial performance. The results indicate that green investment can enhance profitability by improving operational efficiency, reducing compliance risks and enhancing corporate reputation. However, due to policy burdens, multiple agency problems and insufficient profit incentives, state-owned enterprises tend to deviate from efficiency-oriented goals in green investment, which reduces the economic returns of such investment. This study enriches the understanding of the economic consequences of green investment under heterogeneous ownership, and provides empirical support for enterprises to optimize green investment decisions and regulators to improve governance mechanisms.
Ying Liu, J. Yau, A. Marsidi· Sustainability· 0 citations
Purpose: The impact of ESG disclosure and profitability on green innovation is examined in this study, with the moderating role of corporate governance quality assessed among publicly listed companies in Indonesia.Research Methodology: Quantitative approach was employed, and panel data from 19, the analysis was conducted on the Sri?Kehati Index over the 2020–2024 period, employing moderated panel data regression techniques.Results: The study found that ESG disclosure and profitability positively influence green innovation, with this relationship being reinforced by the quality of corporate governance. Consequently, the ability of ESG practices and financial performance to foster green innovation was shown to rely on robust governance mechanisms.Conclusions: The impact of ESG disclosure and profitability on green innovation was found to be moderated and enhanced by the quality of corporate governance.Limitations: Several limitations were identified, including the limited number of samples, the relatively short observation period, and the use of index-based disclosure measurements, which might not entirely reflect the actual effectiveness of sustainability practices.Contributions: This study contributes to the literature by showing that the impact of ESG disclosure and profitability on green innovation is strengthened by corporate governance quality. The application of Resource-Based View, Legitimacy, and Agency Theories is extended to emerging markets, and practical implications are provided for investors and policymakers.
This study aims to examine the mediating role of green process innovation in the relationship between financial resources, ESG risk ratings, and environmental performance among Indonesian manufacturing firms. Employing a quantitative approach with partial least squares structural equation modeling (PLS‐SEM), the analysis is based on data from 125 publicly listed manufacturing firms on the Indonesia Stock Exchange during the 2019–2022 period. The results reveal that financial resources positively influence both green process innovation and environmental performance, whereas ESG risk ratings exert a negative impact on both. Green process innovation significantly mediates the effects of financial resources and ESG risk on environmental performance. These findings underscore the strategic importance of process‐level innovation as a conduit through which internal resources and external stakeholder pressures can be transformed into improved environmental outcomes. Theoretically, this study extends the resource‐based view, stakeholder theory, and the do no significant harm (DNSH) principle by showing that green process innovation is a strategic mechanism that transforms internal resources into better environmental performance and offers practical implications for promoting sustainable industrial transformation in emerging economies.
Andreani Hanjani, Abdul Rohman, RR Karlina Aprilia Kusumadewi et al.· Business Strategy and the En...· 0 citations
Amid the global sustainability movement and China's "dual carbon" commitments, ESG (Environmental, Social, and Governance) has become a pivotal driver of corporate transformation and long-term viability. This paper examines China Feihe Limited to investigate the relationship between ESG performance and financial outcomes over 2022–2025. The results suggest a non-linear relationship: during upswings, ESG contributes to profit growth through cost efficiencies and pricing power; during downturns, however, its inherent cost rigidity tends to amplify earnings volatility. Nevertheless, ESG-driven structural improvements and enhanced financial resilience can buffer downturns. The financial effects of ESG thus vary with the business cycle. Accordingly, firms should capitalize on its amplifying benefits during expansions while proactively managing cost rigidities in contractions, so as to strike a dynamic equilibrium between near-term profitability and sustained value creation.
Yan Jiang, Xiaoman Chen, Jia-Li Weng· Frontiers in Business, Econo...· 0 citations
The integration of environmental, social, and governance (ESG) factors into corporate business strategy has become progressively important, particularly for firms operating in high‐materiality industries where nonfinancial risks are more pronounced. This study examines the association between ESG performance and firm performance among European listed companies within high‐materiality industries during the period 2014–2024. Using panel data collected from established financial and sustainability databases, the analysis studies the influence of aggregate ESG scores and their individual components on key firm performance indicators, including return on assets (ROA), return on equity (ROE), and Tobin's
Q
. The empirical results reveal a predominantly positive association between ESG integration and firm performance, with stronger and more statistically significant effects observed for market‐based and operational performance measures. In particular, governance‐related ESG dimensions exhibit the most consistent positive influence, whereas environmental initiatives may impose short‐term financial constraints due to higher implementation costs. The findings highlight the importance of strategically embedding ESG considerations into corporate managerial procedures, especially in sectors characterized by high material exposure. This research contributes to the existing literature by emphasizing the role of industry‐specific materiality in shaping the ESG–performance relationship within the European context.
M. Fülöp, Javier Cifuentes‐Faura, D. Topor· Business Strategy and the En...· 0 citations
This study examines whether environmental, social, and governance (ESG) performance enhances firm value in China’s A-share market, how this relationship operates, and under what conditions it becomes stronger. Drawing on stakeholder theory, the natural resource-based view, and the dynamic capabilities perspective, this study develops a moderated mediation framework in which green innovation mediates the ESG–firm value relationship and digital transformation strengthen the ESG–green innovation link. Using panel data for 4423 Chinese A-share listed firms comprising 27,254 firm-year observations from 2009 to 2023, the hypotheses are tested using two-way fixed-effects models, mediation and moderated mediation analyses, robustness tests, and instrumental-variable estimation. The results show that overall ESG performance is positively associated with firm value, although its dimensions exhibit heterogeneous effects: environmental performance is negatively associated with firm value, whereas social and governance performance show positive associations. Green innovation partially mediates the ESG–firm value relationship, indicating that ESG creates greater economic value when sustainability commitments are translated into substantive green innovation. Digital transformation further strengthens the indirect effect of ESG performance on firm value through green innovation. Heterogeneity analyses reveal that the value relevance of ESG varies across firm size, ownership type, and industry pollution intensity. The findings suggest that ESG does not create firm value automatically; rather, its economic value depends on firms’ ability to transform sustainability commitments into innovation, with digital transformation enhancing this process. By identifying both the mechanism and the boundary condition of ESG value creation, this study provides new evidence on how and under what conditions ESG contributes to firm value in an emerging market.
Dan Wang, Anis Suriati Binti Ahmad, Nur Amirah Binti Borhan· Journal of Risk and Financia...· 0 citations
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