ESG Investment Scale Allocation of China’s Power Grid Company Using System Dynamics Simulation Modeling

Birong Huang (), Zilong Wang and Yuan Gu
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Birong Huang: College of Economics and Management, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, China
Zilong Wang: College of Economics and Management, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, China
Yuan Gu: School of Electrical Engineering, Southeast University, Nanjing 210096, China

IJERPH, 2023, vol. 20, issue 4, 1-16

Abstract: In recent years, with the global recognition of the concept of sustainable development, the international market attaches great importance to the Environment, Society, and Governance (ESG) investment performance of enterprises. The “carbon peaking and carbon neutrality” goal puts forward requirements for Chinese enterprises to carry out ESG investment. As a large state-owned enterprise in China, power grid companies need to take the lead in ESG investment. Based on the System Dynamics (SD) theory, this paper establishes the simulation model of ESG-responsible investment of power grid companies, including the environmental investment sub-module, social investment sub-module, and governance investment sub-module. Taking a provincial Power Grid Company as an example, the numerical simulation of ESG investment of power grid companies is carried out. The actual input-output efficiency of ESG investment of power grid companies is reflected through the mapping relationship between key indicators and investment amount, and the ESG investment scale and investment weight of the Power Company in the coming years are predicted. Compared with the traditional static analysis method, this model can provide a theoretical basis for power grid companies to carry out ESG investment decisions.

Keywords: Power Grid Company; SD; ESG investment; scale allocation (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2023
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