Institutional ownership heterogeneity and ESG performance: Evidence from China

Wang, Yizhi; Lin, Yongjia; Fung, K. C.; Chen, Songhe

doi:10.1016/j.frl.2022.103448

Cited by 62 publications

(29 citation statements)

References 38 publications

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“…It is worth noting that, unlike the data disclosed by Bloomberg ESG, Sino‐Securities' ESG rating is mainly to evaluate the performance of enterprises' ESG behavior, and its coverage for Chinese listed enterprises is more extensive. Many literatures also use Sino‐Securities' ESG rating data to measure the performance of enterprises' ESG (Li et al, 2023; Wang et al, 2023). In addition, the index system of Sino‐Securities' ESG rating also takes the quality of information disclosure as a sub‐factor in the rating system, and its rating can reflect the ESG disclosure of enterprises partly.…”

Section: Resultsmentioning

confidence: 99%

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Environmental, social, and governance disclosure and capital market mispricing

Wang,

Kong

et al. 2023

Corp Soc Responsibility Env

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With the development of sustainability, ESG information has become a key factor for investors in capital market, but researches on the relationship between ESG disclosure and capital market efficiency has not been clear. Using the data of Chinese A‐share listed companies from 2011 to 2019, this study examined the relationship between ESG disclosure and market mispricing. The results showed that the higher ESG disclosure with lower level of mispricing, which was also verified in both the overvalued and undervalued samples. The test of environmental (E), social (S), and, governance (G) showed that environmental disclosure can restrain the over‐valuation, social disclosure can mitigate the under‐valuation, and corporate governance disclosure has no significant impact on the mispricing. In addition, this paper identified the effect of ESG disclosure on market mispricing by using exogenous market fluctuation. Furtherly, mechanism analysis results showed that ESG disclosure can affect pricing deviation through signaling and supervision effects.

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Section: Resultsmentioning

confidence: 99%

“…( (Li et al, 2023;Wang et al, 2023). In addition, the index system of Sino-Securities' ESG rating also takes the quality of information disclosure as a sub-factor in the rating system, and its rating can reflect the ESG disclosure of enterprises partly.…”

Section: Change Sample Periodmentioning

confidence: 99%

Environmental, social, and governance disclosure and capital market mispricing

Wang,

Kong

et al. 2023

Corp Soc Responsibility Env

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“…ESG : We measured ESG ratings based on the Wind database. Specifically, based on a study by Wang et al. (2023b), we assigned nine levels of ESG performance to companies: AAA to 9, AA to 8, A to 7, BBB to 6, BB to 5, B to 4, CCC to 3, CC to 2 and C to 1.…”

Section: Methodsmentioning

confidence: 99%

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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“…The ESG ratings are important indicators of corporate social responsibility and affect default rates, total risks and special risks (Sassen et al, 2016), valuations, reputations (Galletta et al, 2023) and complete factor productivity (Deng et al, 2023). Meanwhile, enterprises often improve ESG ratings in order to establish good corporate images for investors, creditors, and the public, such as through reasonable capital structures, institutional investors visiting corporate websites (Jiang et al, 2022), institutional ownership heterogeneity (Wang et al, 2023), and enterprise digitalization (Fang et al, 2023). According to Chen and Xie (2022) and DasGupta (2022), ESG disclosure more positively impacts a company's financial performance when it has ESG investors, a longer history, higher media attention, and higher agency costs.…”

Section: Theories and Literature Reviewmentioning

confidence: 99%

Role of environmental, social, and governance rating data in predicting financial risk and risk management

Liu,

Ge,

Wang

2023

Corp Soc Responsibility Env

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Traditional industrial enterprises are primarily high pollution enterprises and high energy consumption. The achievement of the “dual carbon” motive in Chinese economic activities and environmental protection plays a chief role incorporating the environmental, social, and governance (ESG) into the risk management system of industrial enterprises. However, the industrial enterprises participating in ESG rating account for 46.97% of the listed enterprises, and the industrial enterprises that pay attention to ESG information disclosure account for 35.77% of the listed enterprises. Is ESG rating essential for the enhancement of industrial enterprises? Based on the transformation and upgrading of industrial enterprises, this research investigates how the ESG rating and ESG information disclosure affect the financial risk of industrial enterprises in China. The findings suggest that: (1) In China for industrial enterprise ESG plays an essential role which results in decrease in financial problems of industrial enterprise. (2) ESG is influential on monetary risk of industrial enterprise, the quality of enterprise ESG information disclosure plays an important intermediary role. (3) The lagging of ESG rating by one period is significantly positive related to the financial risk of industrial enterprises, and the financial risk prediction of industrial enterprises can be effectively indicated by the ESG rating data, which exhibits a stronger correlation coefficient than the existing rating system.

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Institutional ownership heterogeneity and ESG performance: Evidence from China

Cited by 62 publications

References 38 publications

Environmental, social, and governance disclosure and capital market mispricing

Environmental, social, and governance disclosure and capital market mispricing

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

Role of environmental, social, and governance rating data in predicting financial risk and risk management

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