ESG disclosure and technological innovation capabilities of the Chinese listed companies

Chen, Lifeng; Khurram, Muhammad Usman; Gao, Yuying; Abedin, Mohammad Zoynul

doi:10.1016/j.ribaf.2023.101974

Cited by 70 publications

(29 citation statements)

References 75 publications

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“…Second, after receiving ESG signals, the capital market will increase its recognition and support for the firm (Chen et al, 2023a;Zhong et al, 2022). High ESG performance sends a signal to the capital market that the company is actively engaged in fulfilling its environmental, social and corporate governance responsibilities, which increases the confidence of the capital market in the firm (Chen and Xie, 2022) and significantly reduces the subjective probability of the firm being perceived as high risk (e.g.…”

Section: Esg and Firms' Innovation Efficiencymentioning

confidence: 99%

“…This study contributes to the literature on ESG, innovation and signaling theory in several ways. First, unlike existing studies that still debate how ESG affects firms' innovation performance or innovation input (Broadstock et al, 2019;Chen et al, 2023a;Li et al, 2023a;Wang et al, 2023a), this study is the first to explore ESG's impact on firms' innovation efficiency, thus enabling us to understand how it affects firms' innovation in a more finegrained way. Second, prior research has focused on the impact of Internet development (Luo et al, 2023), knowledge sourcing (Asimakopoulos et al, 2020) and common ownership (Li et al, 2023b) on firms' innovation efficiency.…”

Section: Introductionmentioning

confidence: 99%

“…For example, 3,038 investors with total assets of more than $100tn have signed a pledge to consider and evaluate firms' ESG information in their investment decisions (Berg et al, 2022). In addition, ESG is seen as presenting a valuable opportunity for firms to enhance their competitive advantage (Chen et al, 2023a;Ren et al, 2023).…”

Section: Introductionmentioning

confidence: 99%

“…As innovation has become an important source of competitive advantage for firms in the current environment of highly competitive markets (Ko and Choi, 2023;Laachach and Ettahri, 2023), numerous scholars have invested significant time and effort to explore the impacts of ESG on firm innovation (Broadstock et al, 2019;Chen et al, 2023a;Li et al, 2023a;Wang et al, 2023a). However, although a large proportion of scholars believe that ESG can promote firm innovation (Chen et al, 2023a;Wang et al, 2023a), some studies have found that ESG has no effect or even a negative effect on firm innovation (Broadstock et al, 2019). Thus, scholars have yet to reach a consistent consensus on the relationship between ESG and firm innovation.…”

Section: Introductionmentioning

confidence: 99%

“…China is an ideal place to test our theoretical ideas for several reasons. First, China is the largest emerging economy, and its government is paying increasing attention to firms' ESG performance (Chen et al, 2023a;Ren et al, 2023). Therefore, China can provide a large number of research samples for us to explore the impact of ESG on innovation efficiency.…”

Section: Introductionmentioning

confidence: 99%

See 4 more Smart Citations

ESG performance and firms' innovation efficiency: the moderating role of state-owned firms and regional market development

Wan,

Fu,

Zhong

2023

BPMJ

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PurposeAlthough the impact of environmental, social and governance (ESG) on firms' innovation has attracted attention, the existing research findings diverge. The authors believe that failure to consider both innovation input and output is an important reason for the divergence of conclusions in the extant literature when discussing the impact of ESG and firm innovation. Thus, based on signaling theory, this study aims to reconcile these divergent findings by examining the impact of ESG performance on firms' innovation efficiency.Design/methodology/approachTo seek empirical evidence to support the authors’ theoretical view, the authors conduct an empirical test based on the Tobit model using 8 years of data from Chinese listed companies.FindingsAlthough ESG performance effectively improves firms' innovation efficiency, the institutional-level signaling environment (including state-owned firms and regional market development) weakens the positive effect of ESG performance on firms' innovation efficiency. Further tests suggest that financing constraints partially mediate the relationship between ESG performance and firms' innovation efficiency.Originality/valueBy systematically revealing whether, how and under what circumstances ESG performance improves firms' innovation advantages, this study bridges the gap in the existing literature and highlights important implications to suggest how firms can better capture the value associated with ESG.

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Section: Esg and Firms' Innovation Efficiencymentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 3 more Smart Citations

ESG performance and firms' innovation efficiency: the moderating role of state-owned firms and regional market development

Wan,

Fu,

Zhong

2023

BPMJ

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Navigating the impact: A comprehensive analysis of ESG disclosure consequences through systematic review

Li,

Saat,

Khatib

et al. 2024

Bus Strat Dev

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The purpose of this article is to provide a comprehensive and systematic assessment of the literature on the consequences of environmental, social, and governance (ESG) disclosure by means of content analyses. Using a systematic approach, a sample of 165 studies was collected from the Web of Science database and evaluated on the basis of econometric and content analyses, including publication trends, geographical distribution, theories and consequence associated with ESG disclosure (investment and innovation of firms, financing cost and method, operations and financial risk of firms, firm performance and value and others), provides some direction for future investigation. According to the analysis, the literature was more interested in the stakeholder theory when examining the effects of ESG disclosure on areas including company innovation and investment, financing costs and methods, financial risk and operations, business performance, and others. Even though most of the literature has focused on firm performance and value, there is still no clear understanding of the relationship. Also, limited work was found on the investment and innovation of firms, and financing cost and method, while the impact of operations and financial risk of firms has yet to be explored. Meanwhile, this study also identified the impact of ESG disclosure on analysts, audit fees, and earnings management as a new research direction. Finally, this study innovates new findings that institutional pressures may have an impact on the consequences of ESG disclosure, a topic not found in previous studies.

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Nexus of environmental, social, and governance performance in China‐listed companies: Disclosure and green bond issuance

Wang,

Chen,

Ali

et al. 2023

Bus Strat Env

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This study establishes a connection between existing literature on corporate environmental, social, and governance (ESG) matters, information disclosure, and green bonds by employing the issuance of green bonds to indicate investors' acknowledgment of a company's sustainable activities. Prior research has not adequately addressed the relationship between ESG performance, disclosure, and green bond issuance. A novel dataset has been compiled by merging ESG performance and information disclosure data of Chinese‐listed companies spanning from 2016 to 2020, alongside green bond issuance information from the Wind and Hexun databases. Concurrently, China's pursuit of carbon neutrality necessitates the establishment of a green, low‐carbon, and circular economy framework. ESG has surfaced as an indispensable instrument for appraising a company's sustainability and advocating the enhancement of its information disclosure systems, thereby aiding investors in forming well‐informed judgments. This study scrutinizes the correlation between each facet of ESG performance, disclosure, and green bond issuance, from the perspective of companies listed in emerging markets. The findings corroborate that companies exhibiting commendable ESG practices are more predisposed to issuing green bonds, particularly when such practices are suitably disclosed. The identified evidence will spur the enforcement of obligatory ESG disclosure regulations, further propelling China's advancement in ecological civilization and green finance.

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ESG disclosure and technological innovation capabilities of the Chinese listed companies

Cited by 70 publications

References 75 publications

ESG performance and firms' innovation efficiency: the moderating role of state-owned firms and regional market development

ESG performance and firms' innovation efficiency: the moderating role of state-owned firms and regional market development

Navigating the impact: A comprehensive analysis of ESG disclosure consequences through systematic review

Nexus of environmental, social, and governance performance in China‐listed companies: Disclosure and green bond issuance

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