ESG rating disagreement and supply chain bargaining power: evidence from China

Yuxiu Si and Gongliang Wu

Finance Research Letters, 2025, vol. 83, issue C

Abstract: This study uses data from Chinese A-share listed firms between 2015 and 2022 to examine the impact of ESG rating disagreement on firms' supply chain bargaining power. The findings indicate that ESG rating disagreement has a significant negative impact on supply chain bargaining power, while high-quality information disclosure can significantly mitigate this adverse effect. The mechanism analysis reveals that ESG rating disagreement hinders the expansion of firms' supply chain bargaining power by affecting investor sentiment and increasing reputational risks. Heterogeneity analysis further shows that the suppressive effect of ESG rating disagreement on supply chain bargaining power is more pronounced in state-owned enterprises, firms in regions with low levels of marketization, and non-heavy-polluting firms. This study provides important insights for improving ESG ratings and promoting the development of a unified and comprehensive ESG rating system.

Keywords: ESG ratings; ESG rating disagreement; Supply chain bargaining power (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:83:y:2025:i:c:s1544612325009584

DOI: 10.1016/j.frl.2025.107699

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