The Effect of Environmental, Social, and Governance Performance Factors on Firms’ Cost of Debt: International Evidence

IF 2 Q2 BUSINESS, FINANCE

International Journal of Accounting Pub Date : 2020-09-01 DOI:10.1142/S1094406020500146

M. Houqe, Kamran Ahmed, G. Richardson

引用次数: 9

Abstract

This study examines the effect of environmental, social, and governance (ESG) performance on firms’ cost of debt (COD). Based on a sample of 18,950 firm-year observations from 41 countries over the period of 2008–2015, we find a significant negative association between aggregate ESG performance and firms’ COD. We also observe a significant negative association between the individual ESG performance factors (E, S, and G) and firms’ COD. In addition, the negative association between aggregate/individual ESG performance and firms’ COD is economically significant, ranging from 16.93% to 21.20% of median COD values. Finally, disclosure of ESG performance, stakeholder orientation, investor protection, control of corruption, and social progress have pronounced effects on the negative association between ESG performance and firms’ COD. Taken together, our results suggest that ESG performance has a significant negative effect on firms’ COD from an international perspective.

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环境、社会和治理绩效因素对企业债务成本的影响:国际证据

本研究考察了环境、社会和治理(ESG)绩效对企业债务成本(COD)的影响。基于来自41个国家的18950家公司2008-2015年的观察样本，我们发现总体ESG绩效与公司的COD之间存在显著的负相关关系。我们还观察到个体ESG绩效因素(E、S和G)与企业的COD之间存在显著的负相关。此外，总体/个人ESG绩效与企业COD之间的负相关关系在经济上是显著的，其范围为COD中值的16.93%至21.20%。最后，ESG绩效披露、利益相关者导向、投资者保护、腐败控制和社会进步对ESG绩效与企业COD之间的负相关关系有显著影响。综上所述，我们的研究结果表明，从国际视角来看，ESG绩效对企业的COD有显著的负向影响。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

International Journal of Accounting BUSINESS, FINANCE-

CiteScore

1.20

自引率

0.00%

发文量

期刊介绍： The aim of The International Journal of Accounting is to advance the academic and professional understanding of accounting theory, policies and practice from the international perspective and viewpoint. The Journal editorial recognizes that international accounting is influenced by a variety of forces, e.g., governmental, political and economic. Thus, the primary criterion for manuscript evaluation is the incremental contribution to international accounting literature and the forces that impact the field. The Journal aims at understanding the present and potential ability of accounting to aid in analyzing and interpreting international economic transactions and the economic consequences of such reporting. These transactions may be within a profit or non-profit environment. The Journal encourages a broad view of the origins and development of accounting with an emphasis on its functions in an increasingly interdependent global economy. The Journal also welcomes manuscripts that help explain current international accounting practices, with related theoretical justifications, and identify criticisms of current policies and practice. Other than occasional commissioned papers or special issues, all the manuscripts published in the Journal are selected by the editors after the normal double-blind refereeing process.