Towards the establishment of an ESG rating in emergent markets: firm-level evidence from Tunisia

Sina Belkhiria, Imen Bouchmel, Azhaar Lajmi and Douaa Hajbraik

International Journal of Development Issues, 2026, vol. 25, issue 3, 365-384

Abstract: PurposeThis study aims to examine the determinants of environmental, social and governance (ESG) practices within Tunisian companies, in order to identify how the specific characteristics of companies influence their ESG engagement in the context of an emerging market.Design/methodology/approachThe analysis draws on survey data from 55 Tunisian firms across industrial, financial and consulting sectors. A principal component analysis (PCA)-based composite ESG index, aligned with the Tunis Stock Exchange framework, is constructed to assess performance across environmental, social and governance dimensions.FindingsThe results reveal that governance and social practices are relatively advanced, while environmental initiatives remain limited. Larger, older, listed and group-affiliated firms exhibit higher ESG performance, suggesting that organizational resources and institutional pressures play a critical role in shaping ESG engagement in Tunisia.Practical implicationsThese findings provide insights for policymakers and corporate leaders. Strengthening regulatory incentives, improving ESG disclosure frameworks and supporting capacity-building initiatives could foster stronger environmental integration and more balanced ESG development across sectors. Furthermore, integrating ESG criteria into governance mechanisms and internal management tools appears essential to strengthen the alignment between financial performance and sustainable performance.Originality/valueThis paper contributes to the ESG literature by providing novel empirical evidence from Tunisia, an underexplored context in sustainability research. By constructing a PCA-based composite ESG index aligned with the Tunis Stock Exchange framework and analysing firm-level determinants of ESG engagement, it offers new insights into how institutional and organizational factors shape ESG adoption in emerging economies. Finally, the study combines methodological rigor with strong contextual grounding, providing a fresh perspective on ESG dynamics in environments characterized by evolving and heterogeneous institutional pressures.

Keywords: ESG performance; Sustainable development; Environmental and social governance; Organizational characteristics; Emerging markets; Principal component analysis (search for similar items in EconPapers)
Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.emerald.com/ijdi/article/25/3/365/1394 ... -of-an-ESG-rating-in (text/html)
https://www.emerald.com/ijdi/article-pdf/doi/10.11 ... i-10-2025-0255en.pdf (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:eme:ijdipp:ijdi-10-2025-0255

DOI: 10.1108/IJDI-10-2025-0255

Access Statistics for this article

International Journal of Development Issues is currently edited by Dr Dilip Dutta

More articles in International Journal of Development Issues from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().