IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v67y2024ipas1544612324007943.html
   My bibliography  Save this article

Does environmental, social, and governance rating affect firms’ real earnings management

Author

Listed:
  • Wu, Keping
  • Kong, Dongmin
  • Yang, Wei

Abstract

We examine whether and how ESG ratings influence real earnings management (REM) in firm in the context of China. We find a significant negative correlation between ESG ratings and REM, suggesting that higher ESG ratings improve corporate governance and transparency, thereby reducing REM. Our findings also reveal that internal control quality, external supervision, analyst attention, and corporate governance enhance the negative impact of ESG ratings on REM. Our findings provide empirical insights for investors and policymakers in emerging markets on enhancing corporate transparency and governance through ESG performance.

Suggested Citation

  • Wu, Keping & Kong, Dongmin & Yang, Wei, 2024. "Does environmental, social, and governance rating affect firms’ real earnings management," Finance Research Letters, Elsevier, vol. 67(PA).
    • Handle: RePEc:eee:finlet:v:67:y:2024:i:pa:s1544612324007943
    DOI: 10.1016/j.frl.2024.105764
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612324007943
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2024.105764?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    ESG Rating; Real earnings management; Mechanism;
    All these keywords.

    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:67:y:2024:i:pa:s1544612324007943. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.