The Impact of ESG Management on Investment Decision: Institutional Investors’ Perceptions of Country-Specific ESG Criteria

Abstract

Existing global ESG models are limited in terms of applicability and predictability, especially in countries with an unstable environment. On the other hand, utilizing internally made or privately sourced ESG models have caused issues relating to generalizability, comparability, and continuity. In our research, we present an ESG framework that is specific to South Korea, which has both global and country-specific factors in all three categories. The AHP model is used to determine how the three categories’ materiality would be viewed by institutional investors as well as how country-specific factors rank against global factors. The results of this study show that institutional investors place more importance on environmental and governance factors compared to social factors. Factors including shareholders’ rights, pollution and waste, greenhouse gas emissions, and risk and opportunity management are found to have greater influences on investors’ investment decisions. In addition, it was confirmed that both of the country-specific variables for South Korea, partnership with subcontractor and CEO reputation, have a significant influence on investment decisions. By having the ESG model validated by institutional investors, who are the main users of ESG disclosures of corporations, our methodology of presenting a country-specific model can be benchmarked by studies on other emerging markets with a variety of country-level specificities.

Challenges in the EU Banking Sector as Exemplified by Poland in View of Legislative Changes Related to Climate Crisis Prevention

“…The emphasis on sustainable finance is not only driven by market pressures but also by regulations being adopted by the European Union as part of the European Green Deal [34]. The EU has been the first economic community to establish ESG requirements, with the implementation of the EU Directive on Non-Financial and Diversity Information [38]. More recently, it is also important to note that important organisations such as the European Banking Authority (EBA), European Association of Co-operatives Bank (EACB) and European Banking Federation (EBF) have initiated various activities and initiatives in the ESG area that have resulted in the finalisation of guidelines [35].…”

Green Supply Chain Management Efforts of First-Tier Suppliers on Economic and Business Performances in the Electronics Industry

“…More countries are requiring the disclosure of corporate environmental, social, and governance (ESG) resports and companies are being evaluated on their socially responsible practices by multiple stakeholders [15][16][17]. Therefore, companies including small and medium-sized enterprises have to find strategic ways to deal with sustainable management of their entire operations.…”

“…With the increasing attention to sustainability, large corporations are under a lot of pressure to ensure their supply chain participants' environmental practices. Not only the financial profitability, but financial investors also investigate the ESG soundness of the firms for the investment decisions [16]. ESG evaluation criteria include value-adding activities of the firms concerning their stakeholders, one of the groups being suppliers who are often SMEs.…”

The Influence of Hotel Employees’ Perception of CSR on Organizational Commitment: The Moderating Role of Job Level

“…The issue of Corporate Social Responsibility (CSR) has been receiving a great deal of attention in many academic areas and from the business media during the last two decades [1][2][3]. The reason for this is that CSR is regarded as a method of building an organizational reputation and enhancing the corporate image as well as providing advantages to both companies and their stakeholders [4].…”

“…To further understand employees' perception of CSR, our research on the Korean hotel industry focuses on the relationships among employees' perception of CSR, their intrinsic motivations, as well as OC. Using stakeholder theory as a theoretical background, this study investigates (1) the relationship between the perceptions of hotel employee-related and customer-related CSR and their intrinsic motivations, (2) the relationship between intrinsic motivation and OC, (3) the intermediate role of intrinsic motivation between CSR perception and OC, and (4) the moderating effect of an employee's job level on the relationship between CSR perception and intrinsic motivation. By doing so, this study attempts to contribute to the existing CSR literature by finding out the underlying influence of South Korean hotel employees' perception of CSR on their own OC.…”