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Environmental, Social, and Governance Performance and Financial Impacts: Comparative Analysis of Companies in Asia

Author

Listed:
  • Yoshida , Kenichi

    (Kyushu University)

  • Xie, Jun

    (Kyushu University)

  • Managi, Shunsuke

    (Kyushu University)

  • Yamadera, Satoru

    (Asian Development Bank)

Abstract

This study investigated environmental, social, and governance (ESG) performance and its financial impacts across 38 economies from 2013 to 2022, with a special focus on firms in Asia. The main findings are as follows. First, notable disparities in ESG assessments were found across major rating agencies due to a lack of commensurability in ESG elements and evaluation methods. Second, the multilevel model analysis demonstrated considerable space for enhancing the ESG performance of companies in Asia, in contrast to that of their counterparts in Europe. Notably, the ESG practices of firms in Southeast Asia have stronger positive relationships with financial performance. Finally, inclusive wealth significantly moderates the financial impacts of ESG practices and can serve as a valuable sustainability indicator at the national level to inform ESG practices specific to different regions.

Suggested Citation

  • Yoshida , Kenichi & Xie, Jun & Managi, Shunsuke & Yamadera, Satoru, 2024. "Environmental, Social, and Governance Performance and Financial Impacts: Comparative Analysis of Companies in Asia," ADB Economics Working Paper Series 741, Asian Development Bank.
    • Handle: RePEc:ris:adbewp:0741
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    More about this item

    Keywords

    ESG performance; comparative CSR; inclusive wealth; multilevel regression model;
    All these keywords.

    JEL classification:

    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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