Judicial quality and corporate ESG performance: Evidence from the establishment of circuit courts

Yuan Yang, Baomin Wang and Xingyu Su

Finance Research Letters, 2024, vol. 65, issue C

Abstract: Effective legal systems are crucial to the implementation of corporate social responsibility. This paper employs the implementation data of China's Supreme People's Court as a quasi-natural experiment to evaluate the potential influence of the circuit court system on corporate environmental, social, and governance (ESG) performance. This study affirms that the circuit court system can improve corporate ESG performance via deterrence, regional cohort, and governance effects. These findings offer a fresh viewpoint on how legal regulations can facilitate the high-quality growth of small firms by providing practical insights for government agencies to encourage ESG achievement.

Keywords: Judicial quality; Environmental, social and governance performance; Circuit court (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:65:y:2024:i:c:s1544612324006408

DOI: 10.1016/j.frl.2024.105610

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