Impact and mechanism analysis of ESG ratings on the efficiency of green technology innovation

Yacheng Zhou, Weidong Huo, Lan Bo and Xiaoxian Chen

Finance Research Letters, 2023, vol. 58, issue PD

Abstract: This study examines how environmental, social, and governance (ESG) ratings affect the efficiency of green technology innovation using listed Chinese companies as a research sample. The results suggest that a higher ESG rating is beneficial for boosting the efficiency of corporate green technology innovation. The mechanism analysis reveals that the impact can be achieved by relaxing financial constraints and encouraging companies to take more risks. Moreover, heterogeneity analysis demonstrates that the impact of ESG ratings on green technology innovation varies significantly across industries. The findings shed light on how to maximize the impact of ESG ratings on green technology innovation efficiency.

Keywords: ESG ratings; The efficiency of green technology innovation; Mechanism analysis; Financing constraints; Risk taking (search for similar items in EconPapers)
JEL-codes: G11 G30 G32 G38 O44 Q54 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:58:y:2023:i:pd:s1544612323009637

DOI: 10.1016/j.frl.2023.104591

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