ESG Performance and Corporate Resilience: An Empirical Analysis Based on the Capital Allocation Efficiency Perspective

Kedan Wang, Shanshan Yu (), Mei Mei, Xiao Yang, Geng Peng and Benfu Lv
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Kedan Wang: School of Economics and Management, University of Chinese Academy of Sciences, Beijing 100190, China
Shanshan Yu: School of Economics and Management, University of Chinese Academy of Sciences, Beijing 100190, China
Mei Mei: Institute of Medical Information & Library, Chinese Academy of Medical Sciences, Beijing 100005, China
Xiao Yang: School of Economics and Management, University of Chinese Academy of Sciences, Beijing 100190, China
Geng Peng: School of Economics and Management, University of Chinese Academy of Sciences, Beijing 100190, China
Benfu Lv: School of Economics and Management, University of Chinese Academy of Sciences, Beijing 100190, China

Sustainability, 2023, vol. 15, issue 23, 1-31

Abstract: As China transitions from high-speed to high-quality economic development, the concept of sustainable development, particularly environmental, social, and governance (ESG), has emerged as a crucial consideration in corporate decision-making. This study examines the relationship between ESG performance and corporate resilience through the lens of capital allocation efficiency. Employing a fixed-effects model, heterogeneity analysis, and a mediation effect model, we analyzed 4436 A-share listed companies that were rated according to ESG standards by the China Securities Index (CSI) between 2011 and 2021. Our findings suggest that: (1) ESG performance positively impacts corporate resilience. (2) The magnitude of this effect varies based on the ownership structure and industry. Specifically, ESG performance has a more significant influence on non-state-owned companies and manufacturing companies. (3) Improving ESG performance can enhance corporate resilience through three mechanisms: reducing financing costs, improving investment efficiency, and improving operational efficiency.

Keywords: ESG performance; corporate resilience; capital allocation efficiency (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:15:y:2023:i:23:p:16145-:d:1284317

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