Role of ESG Ratings in Shaping Investment Attractiveness: Insights from BRICS Countries

Aleksandra Egorova ()
Additional contact information
Aleksandra Egorova: Higher School of Economics (Russia)

Journal of Corporate Finance Research, 2025, vol. 19, issue 1, 5-15

Abstract: The research objective is to analyze the impact of ESG ratings on the investment attractiveness of companies in BRICS countries in comparison with other countries, as well as to study the sectoral specifics of such influence inBRICS countries.The methodology is based on the regression analysis of the impact of ESG ratings and the duration of their disclosure on investment attractiveness indicators, including Tobin’s Q, EV/EBITDA, P/BV, and WACC. The study utilizes a dataset comprising 16 691 observations for 1859 companies from 57 countries between 2014 and 2022, including 2116 observations for 236 companies from BRICS countries. The analysis revealed that an increase in ESG ratings positively affects market value (Tobin’s Q) and risk reduction (WACC) in BRICS countries, while in other countries, their influence is associated with increase in EV/EBITDA and decrease in P/BV. Sector analysis revealed that ESG rating increase positively influence market value in information technology and communication sectors. This study is the first to conduct a comparative analysis of ESG impact in BRICS countries and other regions, including a sectoral analysis, whichmakes the findings valuable for shaping ESG strategies in this market and assessing business sustainability.

Keywords: ESG; ESG ratings; green economy; investment attractiveness; corporate social responsibility (CSR); sustainable development; environmental factors; social factors; corporate governance; financial performance; BRICS countries (search for similar items in EconPapers)
JEL-codes: D22 G32 H23 L25 O13 O16 Q01 Q56 R11 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://cfjournal.hse.ru/article/view/24016/22293 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hig:jcorpf:v:19:y:2025:i:1:p:5-15

Access Statistics for this article

More articles in Journal of Corporate Finance Research from National Research University Higher School of Economics
Bibliographic data for series maintained by Stepan () and Stepan ().