Author(s)

Yinuo Xu ¹, Hongwang Zheng ²

Affiliation(s)

¹ Business School, The University of Sydney, Sydney, 2006, Australia
² School of Management, Hefei University of Technology, Hefei, 230009, China

Corresponding Author

Yinuo Xu

ABSTRACT

Environment, social, and governance (ESG) has been expected as an important way for green innovation and sustainable development under the double-carbon target in China. The question then arises as to whether and how ESG performance affects corporate value. To answer this question, we conduct an empirical analysis of 1084 listed Chinese A-share companies over the 2011~2020 period using the panel data regression. The empirical results show that ESG performance significantly promotes corporate value even after addressing the endogeneity issue. This promotion process is mainly achieved by improving corporate reputation. The numerical results confirm that although the indirect effect (0.0003) is statistically significant, it only accounts for a small part of the total impact (0.0058) of ESG performance on corporate value. Overall, our findings offer new insights into the role of corporate reputation through which corporates can benefit from their ESG engagement.

KEYWORDS

ESG, Corporate value, Corporate reputation, Media attention, Listed corporations

CITE THIS PAPER

Yinuo Xu, Hongwang Zheng, ESG performance and corporate value: The mediating role of reputation. Industrial Engineering and Innovation Management (2024) Vol. 7: 30-38. DOI: http://dx.doi.org/10.23977/ieim.2024.070105.

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