Assessing the impact of environmental, social, and governance (ESG) on enterprise energy efficiency

Abstract

In pursuit of China's dual carbon objectives—carbon peaking and carbon neutrality—enhancing corporate energy efficiency has emerged as a pivotal strategy for addressing climate change and environmental degradation. Despite the growing importance of sustainable business practices, the relationship between corporate Environmental, Social, and Governance (ESG) performance and energy efficiency remains inadequately examined. This study explores how ESG practices influence corporate energy efficiency by analyzing comprehensive data from Chinese listed companies over the period 2010-2022. Our findings demonstrate that ESG performance significantly enhances energy efficiency, with green innovation and green investor entry serving as critical mediating mechanisms. The effect is particularly pronounced among large-scale and non-high-tech enterprises. Furthermore, media attention and digital transformation complementarily and synergistically exert a positive moderating effect on the relationship between ESG and energy efficiency. This research contributes novel theoretical insights and provides actionable recommendations for enterprises seeking to harness ESG initiatives as a pathway to improved energy efficiency and sustainable development.