Catalytic effect of the Shanghai–Hong Kong Stock Connect policy on corporate ESG performance

Cen Cai, Qianyi Yang, Da Tu, Grace Li Tian and Yongqian Tu

International Review of Financial Analysis, 2025, vol. 101, issue C

Abstract: Using the difference-in-differences method and Shanghai Stock Exchange–listed company data from 2007 to 2022, this study investigates the impact of the Shanghai–Hong Kong Stock Connect policy and capital market liberalization on corporate environmental, social, and governance (ESG) performance. Results show a significant improvement in ESG performance following the implementation of the Shanghai–Hong Kong Stock Connect policy. Analyst focus serves as a key intermediary in this process. Furthermore, capital market liberalization enhances corporate information disclosure standards and expedites ESG performance improvements. Following the implementation of the policy, state-owned enterprises demonstrate a particularly substantial increase in ESG performance.

Keywords: Capital market liberalization; Shanghai–Hong Kong Stock Connect; ESG (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:101:y:2025:i:c:s1057521925001036

DOI: 10.1016/j.irfa.2025.104016

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