{"title":"The Lock-In Effect on ESG and Business Performance Relationship: A Critical Examination and Meta-Analysis","authors":"Jéssica Alessandra Mendonça, Fabíola Renata Alves Roberto, Dalton Alexandre Kai, Guilherme Brittes Benitez","doi":"10.1002/csr.70062","DOIUrl":null,"url":null,"abstract":"<p>This study investigates whether the issues previously addressed in the literature regarding business performance persist when applying ESG practices. A literature review identified 252 effects, followed by a meta-analysis with subgroup analysis. The lock-in theory and corporate reputation were employed to understand this relationship. The lock-in view allows a deeper assessment of the authors' decisions on measuring ESG practices. On the other hand, corporate reputation focuses on the importance of positive stakeholder perception when adopting ESG practices. The analysis revealed a statistically significant relationship between ESG practices and business performance, demonstrating a weak effect size. Subgroup analysis showed that social and governance practices have positive effects, highlighting that many studies still use corporate social responsibility (CSR) as a proxy for ESG. We confirm this assumption when we find that financial performance did not show significance, which is the same problem that past literature discussed regarding the trade-off between CSR and financial performance. In addition, we confirm previous assumptions that despite having no significant effect on financial performance, environmental, ESG risk, and innovation performance are improved. Other outcomes show that moderators such as the country's economy and company size influenced the results. These findings proved that academics currently face a lock-in effect on ESG empirical research because they measure CSR and ESG as synonyms in their studies. We showed that most of the effects in this study are like past CSR literature, making authors still find no positive association in financial performance and weak relationships between other performance indicators and ESG practices in their empirical research.</p>","PeriodicalId":48334,"journal":{"name":"Corporate Social Responsibility and Environmental Management","volume":"32 5","pages":"6912-6936"},"PeriodicalIF":9.1000,"publicationDate":"2025-07-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1002/csr.70062","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Corporate Social Responsibility and Environmental Management","FirstCategoryId":"91","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1002/csr.70062","RegionNum":2,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS","Score":null,"Total":0}
引用次数: 0
Abstract
This study investigates whether the issues previously addressed in the literature regarding business performance persist when applying ESG practices. A literature review identified 252 effects, followed by a meta-analysis with subgroup analysis. The lock-in theory and corporate reputation were employed to understand this relationship. The lock-in view allows a deeper assessment of the authors' decisions on measuring ESG practices. On the other hand, corporate reputation focuses on the importance of positive stakeholder perception when adopting ESG practices. The analysis revealed a statistically significant relationship between ESG practices and business performance, demonstrating a weak effect size. Subgroup analysis showed that social and governance practices have positive effects, highlighting that many studies still use corporate social responsibility (CSR) as a proxy for ESG. We confirm this assumption when we find that financial performance did not show significance, which is the same problem that past literature discussed regarding the trade-off between CSR and financial performance. In addition, we confirm previous assumptions that despite having no significant effect on financial performance, environmental, ESG risk, and innovation performance are improved. Other outcomes show that moderators such as the country's economy and company size influenced the results. These findings proved that academics currently face a lock-in effect on ESG empirical research because they measure CSR and ESG as synonyms in their studies. We showed that most of the effects in this study are like past CSR literature, making authors still find no positive association in financial performance and weak relationships between other performance indicators and ESG practices in their empirical research.
期刊介绍:
Corporate Social Responsibility and Environmental Management is a journal that publishes both theoretical and practical contributions related to the social and environmental responsibilities of businesses in the context of sustainable development. It covers a wide range of topics, including tools and practices associated with these responsibilities, case studies, and cross-country surveys of best practices. The journal aims to help organizations improve their performance and accountability in these areas.
The main focus of the journal is on research and practical advice for the development and assessment of social responsibility and environmental tools. It also features practical case studies and evaluates the strengths and weaknesses of different approaches to sustainability. The journal encourages the discussion and debate of sustainability issues and closely monitors the demands of various stakeholder groups. Corporate Social Responsibility and Environmental Management is a refereed journal, meaning that all contributions undergo a rigorous review process. It seeks high-quality contributions that appeal to a diverse audience from various disciplines.