 Internal monitoring mechanisms and corporate environmental and social performance: Evidence from KoreaNam Gyoung Lee, Seung Hun Han and Hyeong Joon Kim Research in International Business and Finance, 2024, vol. 71, issue C Abstract: This study investigates the relationship between corporate environment and social (ES) performance and the governance factor by examining the effect of internal monitoring mechanisms on a firm’s ES performance. We find that institutional ownership, especially pension investors, induces corporate ES performance. To address potential endogeneity concerns, this study employs the adoption of the Stewardship Code in Korea as a quasi-natural experiment, and we find consistent results. Outside directors also positively affect a firm’s ES performance, and this positive impact is more pronounced with institutional investor holding, suggesting that internal monitoring for corporate ES performance might complement each other. Furthermore, a firm’s better ES performance motivated by internal monitoring appears to bring a higher firm value. Overall, this study suggests that internal monitoring mechanisms can induce firms’ non-financial performance and eventually contribute to shareholders’ value. Keywords: ESG; Internal monitoring; Institutional ownership; Pension investors (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:riibaf:v:71:y:2024:i:c:s0275531924002071 DOI: 10.1016/j.ribaf.2024.102414 Access Statistics for this article Research in International Business and Finance is currently edited by T. Lagoarde Segot More articles in Research in International Business and Finance from Elsevier |
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