"Greenwashing" or "Helping": ESG Performance and Chinese Firm Total Factor Productivity

Abstract

: As the market economy has continued to develop, businesses have consistently prioritized profits, excessively emphasizing income and financial gains while neglecting ecological conservation and financial fraud. Consequently, the phenomenon of "greenwashing" has emerged. How to prevent this "greenwashing" phenomenon while pursuing economic benefits and enabling high-quality business development has become a focal point. Therefore, this paper analyzes whether the ESG (Environmental, Social, and Governance) performance of listed companies has an impact on the enhancement of the Total Factor Productivity (TFP) of enterprises. This study aims to explore how companies, while striving to maximize economic interests, can more proactively undertake environmental protection and social responsibility, thereby promoting the green transformation of enterprises. Using A-share listed companies from 2012 to 2022 as the sample, through an empirical examination of the correlation between the ESG performance of listed companies in China and the TFP of enterprises, the following conclusions are drawn: (1) ESG performance significantly promotes the TFP of enterprises, indicating that higher ESG performance corresponds to higher TFP; (2) Through intermediary effect tests, it is found that corporate reputation plays a role in enhancing the TFP of enterprises. That is, through good ESG performance, a company's reputation is improved, thereby leading to higher TFP; (3) Heterogeneity analysis demonstrates that the impact of good ESG performance on the enhancement of TFP is more significant in large-scale enterprises and state-owned enterprises