Does climate governance moderate the relationship between ESG reporting and firm value? Empirical evidence from India

Geeti Mishra, Archana Patro and Aviral Tiwari

International Review of Economics & Finance, 2024, vol. 91, issue C, 920-941

Abstract: Climate governance is an integral part of Environment, Social and Governance (ESG) and contributes to a firm's value by reducing risks, identifying opportunities, enhancing stakeholder relations, and promoting long-term sustainability. Firms that effectively integrate climate considerations into their governance structures are better positioned to thrive in a changing business landscape, ultimately benefiting their financial performance. Using 2,881 firm-year observations from the year 2016–2021 in the Indian context, we empirically find that ESG reporting decreases the firm value. We identified board characteristics (board independence, board meetings, board busyness, and board size) that ameliorate the firm value. Our results are robust to a battery of tests.

Keywords: ESG score; Firm value; Climate governance; Sustainable development; Industries; CSR; Manufacturing; Board characteristics (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:91:y:2024:i:c:p:920-941

DOI: 10.1016/j.iref.2024.01.059

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