Help or Hurt? The Impact of ESG on Firm Performance in S&P 500 Non-Financial Firms

IF 1.6 Q3 BUSINESS, FINANCE
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引用次数: 14

Abstract

The paper aims to investigate the impact of ESG practice on firms’ financial performance in the context of U.S. market from 2018 to 2020. The paper examines a sample of 57 U.S. non-financial firms belonging to the S&P 500. The Two-Stage Least Squares (2SLS) estimation is employed with an instrumental variable - the political views of the states where the studied firms are located. The paper shows that having a better practice of ESG could enhance firms’ financial performance measured by ROA, ROE, and TobinQ. These findings are consistent with the stakeholder-focused theory instead of shareholder-focus perspective. In addition, the magnitude of the influence of the ESG practice on TobinQ is significantly higher than that of the ESG-ROA and ESG-ROE relations. It reveals that the ESG benefits could make the firms appear more attractive to investors, creating higher market values of the firms’ assets and then higher TobinQ ratio. Not as the TobinQ enhancement, the significant improvement in ROA and ROE would be realized in the long run rather than short term. The low managerial ownership in the U.S. market may increase the chance of ESG overinvestment by the firms’ managers, hence reducing firm value. However, under the pressure of the investors’ strong demand for socially responsible investing, the U.S. firms tend to become involved in ESG activities, obtaining a strong stakeholder commitment and thus creating additional firm value in the long run.
帮助还是伤害?ESG对标普500非金融企业绩效的影响
本文旨在研究2018 - 2020年美国市场背景下ESG实践对公司财务绩效的影响。本文以标准普尔500指数成份股中的57家美国非金融公司为样本进行了研究。两阶段最小二乘(2SLS)估计采用了一个工具变量-所研究公司所在州的政治观点。研究表明,更好地实践ESG可以提高企业以ROA、ROE和TobinQ衡量的财务绩效。这些发现与利益相关者关注理论相一致,而不是股东关注观点。此外,ESG实践对TobinQ的影响程度显著高于ESG- roa和ESG- roe关系。结果表明,ESG收益可以使公司对投资者更具吸引力,从而创造更高的公司资产市场价值,从而提高托宾q比率。与TobinQ增强不同的是,ROA和ROE的显著改善将在长期而非短期内实现。美国市场的管理层持股比例较低,可能会增加公司管理者过度投资ESG的机会,从而降低公司价值。然而,在投资者对社会责任投资强烈需求的压力下,美国公司倾向于参与ESG活动,获得强烈的利益相关者承诺,从而在长期内创造额外的公司价值。
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
CiteScore
3.90
自引率
15.80%
发文量
22
审稿时长
24 weeks
期刊介绍: The Australasian Accounting, Business and Finance Journal is a double blind peer reviewed academic journal. The main focus of our journal is to encourage research from areas of social and environmental critique, exploration and innovation as well as from more traditional areas of accounting, finance, financial planning and banking research. There are no fees or charges associated with submitting to or publishing in this journal.
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