Competitive Pressure and ESG

Vesa Pursiainen, Hanwen Sun and Yue Xiang
Additional contact information
Vesa Pursiainen: University of St. Gallen; Swiss Finance Institute
Hanwen Sun: University of Bath

No 23-69, Swiss Finance Institute Research Paper Series from Swiss Finance Institute

Abstract: A firm’s exposure to competition is negatively associated with its ESG performance. We measure exposure to domestic product market competition by product market fluidity, based on product text descriptions, and find that higher fluidity - indicating higher product market threats - is associated with lower ESG scores. Fluidity matters more for financially constrained firms, in capital-intensive industries, and for costly activities. Increasing exposure to Chinese import competition is associated with reduction in ESG scores. This effect of import competition is stronger for firms less exposed to domestic competition. Local climate attitudes and social norms moderate the effect of competitive pressure.

Keywords: competition; product market threats; ESG; sustainability; international trade (search for similar items in EconPapers)
JEL-codes: D40 F18 F64 G30 M14 (search for similar items in EconPapers)
Pages: 57 pages
Date: 2023-08
New Economics Papers: this item is included in nep-com, nep-env, nep-ind and nep-int
References: Add references at CitEc
Citations:

Downloads: (external link)
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4546541 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:chf:rpseri:rp2369

Access Statistics for this paper

More papers in Swiss Finance Institute Research Paper Series from Swiss Finance Institute Contact information at EDIRC.
Bibliographic data for series maintained by Ridima Mittal ().