Pension insurance contributions and ESG performance: Evidence from China

Rui Li, Zhikai Zhu and Xiaoyan Wang

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

Abstract: The paper examines the impact and mechanism of statutory pension insurance contribution rates on firms' ESG performance. Using comprehensive data on statutory pension insurance contribution rates and Chinese listed companies from 2012 to 2019, we find that high contribution rates significantly reduce ESG performance, and the finding remains robust after robustness tests. We explain how pension insurance contributions undermine ESG performance through social responsibility and layoffs. Regarding heterogeneity, labor-intensive and small firms are more susceptible to increased pension insurance.

Keywords: Statutory pension insurance contribution rate; ESG performance; Tax and fee reduction; Chinese listed companies (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:58:y:2023:i:pd:s1544612323010103

DOI: 10.1016/j.frl.2023.104638

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