How Does ESG Performance Affect Corporate Financial Performance? Analysis from Research Dynamics at Home and Abroad

Runze Wang; Wenli Zhu

doi:10.54691/a3rjcc12

Authors

Runze Wang
Wenli Zhu

DOI:

https://doi.org/10.54691/a3rjcc12

Keywords:

ESG Performance; Corporate Financial Performance; Sustainable Development.

Abstract

This paper synthesizes the research trends both domestically and internationally on the impact of corporate Environmental, Social, and Governance (ESG) performance on its financial performance. The majority of the studies support a positive correlation between ESG and financial performance, suggesting that ESG practices contribute to sustainable development and enhance corporate financial outcomes. However, the relationship is complex and may be influenced by a variety of factors, including the measurement methods of indicators, the country or region of the research subjects, and the type of industry, leading to divergent conclusions in existing studies. By reviewing the relationship between ESG performance and financial performance, this paper organizes the differences in research subjects and results behind various conclusions, aiming to provide potential research paths for future studies.

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