When More Isn't Better: The Curvilinear Effects of ESG on Firm Performance
Dar es Salaam Institute of Technology · Sichuan University · +3 more institutions
Abstract
ABSTRACT This study examines the non‐linear effects of ESG performance on firm value in Chinese A‐share listed firms from 2009 to 2023, addressing a gap in emerging‐market ESG research that often assumes a linear, universally positive relationship. Using 29,439 firm‐year observations and performance measures including Tobin's Q, ROA, and ROE, the study applies two‐way fixed‐effect, Lind‐Mehlum U ‐tests, and robustness checks with alternative ESG ratings (Bloomberg and Huazheng) and by excluding extreme market shocks (the 2015 stock market crash and COVID‐19). The findings reveal a robust inverted U‐shaped relationship, demonstrating that moderate ESG engagement enhances firm performance, whereas excessive ESG…
Citation impact
- FWCI
- 104.31
- Percentile
- 100%
- References
- 69
Authors
8- JVJoel Victor DossaCorresponding
Dar es Salaam Institute of Technology, Sichuan University
- JVJoel Victor Dossa
Dar es Salaam Institute of Technology, Sichuan University
- AAAamir Ali Gopang
Sichuan University
- TOTony Osborn Kapola
Muslim University of Morogoro
- CCChiagoziem C. Ukwuoma
Chengdu University of Technology
Topics & keywords
- Corporate governance
- Stock market
- Robustness (evolution)
- Stock (firearms)
- Market value
- Novelty
- Empirical research
- Emerging markets