The relationship between green innovation and sustainable growth in Korean companies: Moderated mediation effect of ESG score by industry

Abstract Sustainable development of companies is emphasized by many asset management companies around the world as an investment decision criterion. So, the most important issue in business management is Environment, Social, and Governance (ESG). But, criticism of ESG has been raised and some studies have found the impact of green innovation and ESG on financial performance to be inconclusive or inconsistent. At this point, this study reviewed ESG‐related researches and examined the relationship between green innovation, ESG, and sustainable growth. By analyzing the mediating effect of ESG score, this study examined whether investment for green innovation directly affects corporate sustainable growth or indirectly affects it through ESG score, an external evaluation. In addition, a moderating variable was added to see if this relationship varies by industry. For this research purpose, the moderated mediation effect analysis using PROCESS macro was conducted in‐depth. Companies received ESG evaluation by Korea Corporate Governance Service were selected as a sample. The results of this study will provide many implications for companies that are driving ESG.