“…Firstly, ESG ratings attract potential investors to obtain capital for the company, preventing underinvestment in innovation caused by the high‐input of new projects. Third‐party rating agencies publish specific information related to the performance of corporate environmental, social, and governance responsibilities, which supplements financial information and improves the transparency of enterprises (Houston & Shan, 2021; Li et al, 2022; Schiehll & Kolahgar, 2020). Transparency builds trust between enterprises and capital providers (Kanagaretnam et al, 2010), which enriches the channels for enterprises to obtain innovation funding by lowering financing costs from external investors (Meng et al, 2021).…”