Government as major customer: The effects of government procurement on corporate environmental, social, and governance performance

Jun Huang, Feifei Han and Yun Li

Finance Research Letters, 2023, vol. 54, issue C

Abstract: This study examines how the government's participation in the product market as a customer affects supplier firms’ environmental, social, and governance (ESG) practices. Using a sample of Chinese listed firms from 2010 to 2020, we find that firms with major government customers exhibit higher ESG performance than those without them. Further analysis shows that female managers, institutional ownership, media coverage, and public attention enhance the positive relationship between major government customers and ESG performance. Overall, the findings suggest that as an important public policy, government procurement can significantly affect stakeholders’ value by improving supplier firms’ ESG performance.

Keywords: Major government customers; ESG performance; Stakeholder theory (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:54:y:2023:i:c:s154461232300154x

DOI: 10.1016/j.frl.2023.103781

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