The Role of ESG Performance in Moderating the Impact of Financial Distress on Company Value: Evidence of Wavelet‐Enhanced Quantile Regression With Indian Companies

Business Strategy and the Environment, Journal Year: 2025, Volume and Issue: unknown

Published: Jan. 8, 2025

ABSTRACT This study presents a novel examination of the influence environmental, social, and governance (ESG) scores on resilience financially distressed Indian companies, integrating wavelet‐enhanced quantile regression approach. The analysis, rooted in context Paris Agreement sustainable finance, employs comprehensive dataset top 512 listed companies from 2012 to 2023. Our findings reveal that high ESG significantly bolster company during financial distress, highlighting dual benefits practices corporate stability environmental impact. Additionally, paper underscores pivotal role wavelet analysis capturing multifaceted effects across various industries distress quantiles, thereby offering more nuanced understanding impacts. These insights not only contribute academic discourse finance but also offer practical implications for policymakers strategists aiming align performance with development goals (SDGs). at which no longer negatively affects firm's value are provided. range between 33.153 33.456 driven by median conditional distribution value. Policy discussed.

Language: Английский

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Nexus between ESG scores and financial performance: evidence from the Indian banking sector

Asian Journal of Accounting Research, Journal Year: 2025, Volume and Issue: unknown

Published: Feb. 10, 2025

Purpose This research analyzes the impact of “Environmental, Social, and Governance” (ESG) practices on Indian banks’ performances with respect to market operational performance. Design/methodology/approach examines 28 banks (12 public sector 16 private sector) from 2021 2023, using multiple regression models a robust generalized least square (GLS) estimation. The include Tobin’s Q (TQ) Return Assets (ROA) as dependent variables, while current lagged ESG performance scores (sourced Refinitive database) constitute main independent variables. Additionally, five control variables specific COVID-19 pandemic are also incorporated into analysis. Findings study reveals that have time sensitive impact, meaning year activities substantial influence in driving financial than past activities. benefits derive tend diminish over time. findings reinforce necessity for maintain dynamic evolving framework remain competitive. it is found show greater initiative implementing banks. Practical implications offers noteworthy inputs academicians, banks, regulators other stakeholders. this broadens understanding sustainable banking domain across different horizons, offering an initial assessment how transparency affects bank during post-mandatory disclosure phase. Originality/value investigates time-sensitive impacts ESG-centric (considering effect) performance, undertaken after implementation Reserve Bank India’s (RBI) 2020 circular relating mandatory commercial

Language: Английский

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Investigating the effect of ESG disclosure on firm performance: The case of Saudi Arabian listed firms

Cogent Economics & Finance, Journal Year: 2023, Volume and Issue: 11(2)

Published: Oct. 9, 2023

This study investigates how environmental, social, and governance (ESG) disclosures influence the performance of listed Saudi Arabian companies. The used unbalanced panel data obtained from Bloomberg database (2010–2020). results show that ESG has significantly reduced TOBINSQ but an insignificant association with return on equity (ROE). Concerning components, environmental disclosure negative is positively related to ROE. Social a insignificantly negatively associated Meanwhile, improved ROE, respectively. Besides, findings offer helpful implications for regulatory bodies policymakers toward providing practical guidelines policies ensure implementation activities maximizes shareholders' wealth.

Language: Английский

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The Influence of Environmental, Social, and Governance Issues in the Banking Industry

Administrative Sciences, Journal Year: 2024, Volume and Issue: 14(7), P. 156 - 156

Published: July 19, 2024

This study examines the current trajectory and future research directions of environmental, social, governance (ESG) integration within banking industry. Utilizing bibliometric scientometric approaches, it highlights trend topics, influential studies, notable contributors. Drawing from an analysis 681 studies Scopus Web Science databases, a comprehensive dataset was curated using networks with VOSviewer Bibliometrix tools. emphasizes evolving nature ESG banking, emphasizing interdisciplinary shift encompassing considerations. Keyword reveals emerging trends, including influence factors on banks’ financial performance, regional variations in risk assessment related to credit banks. By offering insights into topic identifying promising avenues for further exploration, such as fundamental connection between sustainability, particularly climate change green finance, this contributes ongoing discussions surrounding industry, guiding efforts vital sector.

Language: Английский

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The Effect of ESG on Firm Value and Performance During Covid-19

International Journal of Pertapsi, Journal Year: 2024, Volume and Issue: 2(2), P. 69 - 78

Published: Aug. 1, 2024

The objective of this study was to examine the correlation between Environmental, Social, and Governance (ESG), corporate value performance, with aim establishing a basis for assessing ESG. An independent variable is ESG score. variables that will be measured are firm performance. Firm performance assessed using return on assets (ROA), while indicated by Tobin's Q. Industrial growth, which quantifies development industrial aspects, serve as moderator harmonise connection dependent variables. Analysis data indicates factors have detrimental effect company value. improves enterprises. Moreover, growth industry does not alleviate environmental, social, governance (ESG) business. success mitigated industry.

Language: Английский

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Sustainable development and firm value: How ESG performance shapes corporate success—a systematic literature review

Business Strategy & Development, Journal Year: 2024, Volume and Issue: 7(4)

Published: Oct. 16, 2024

Abstract This study is designed to conduct a systematic literature review aimed at assessing the influence of environmental, social, and governance (ESG) performance on firm value. Although previous studies have explored their relationship, comprehensive this topic still lacking. We conducted detailed search in Scopus Web Science databases identified 73 papers published between 2016 2023 as sample, covering annual trends, country industry distribution, theoretical frameworks, proxy variables, research methods, results, provided direction for future research. found significant increase number over past 3 years. Cross‐country dominated field, with most adopting multi‐industry analysis, while focusing single were relatively rare. The stakeholder theory agency widely applied theories. Most showed that ESG had positive effect value, reflecting growing importance markets investors placed its contribution long‐term growth. However, some reported negative or insignificant effects, noting effects varied by industry, region, market environment. suggests should explore independent interactive each dimension dynamic relationships across industries regions, using new methods models, incorporating moderating variables. provides practical guidance managers policymakers optimize practices, enhancing value promoting sustainability.

Language: Английский

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Listing on environmental, social and governance index and financial distress: does the difference-in-differences matter?

Asian Review of Accounting, Journal Year: 2023, Volume and Issue: 32(2), P. 302 - 326

Published: Oct. 19, 2023

Purpose Environmental, social and governance (ESG) issues have become the cornerstone of investment decisions in firms today. With that, publicly traded ESG indices (like BSE 100 index India) come into existence. The existing literature signifies that generates financial implications induces stability. current study aims to test whether listed on (ESG-sensitive firms) face less distress than those not such an index. Design/methodology/approach applies panel data difference-in-differences (DID) regression by considering as unstaggered treatment 74 non-financial India's Bombay Stock Exchanges (BSE) In total, 42 are treated they got index, formed 2017. remaining 32 form control group. confidence intervals standard errors estimated using clustered robust Donald Lang method. Findings Listing matters for stability; differences significant distress. ESG-sensitive non-ESG (or perceived ESG-sensitive). results consistent across two measures, Altman z-scores emerged emerging markets. Thus, DID status between matter. Practical creates vibrant practitioners reduce Originality/value is one its kind effects firm value quantify

Language: Английский

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ESG and share price volatility in energy sector firms: does the development phase of countries matter?

International Journal of Energy Sector Management, Journal Year: 2023, Volume and Issue: 18(5), P. 956 - 979

Published: Aug. 23, 2023

Purpose The global energy sector draws significant stakeholder attention due to never-ending controversies surrounding its environmental impacts. Investors’ response such causes direct financial implications for these firms. Furthermore, environmental, social and governance (ESG) sensitivity, which is likely safeguard the firms from controversies, itself conditional development stage of a country regulatory environment. Therefore, this study aims investigate if influence ESG on share price volatility (SPV) subject countries. Design/methodology/approach investigates nine years panel data 93 developing developed nations. Using dynamic two-way fixed effects estimation computing robust standard errors obtain econometric results. Findings main finding reveals that impact SPV is, indeed, Similar results are observed dimension SPV. While impacts negatively in economies, opposite In other words, strong propositions induce stability countries while destabilizing Practical policymakers should further streamline regulations policies related adoption adherence. practice, sectors their operations. Firm managers, especially sector, devise strategies with as an essential component against market adversatives. nations strengthen foster equity harmony. Originality/value contributes through niche investigations very important world economy. relevant current scenario when faces severe crisis supply chain issues.

Language: Английский

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The impact of environmental, social and governance (ESG) scores on stock market: evidence from G7 countries

Journal of Global Responsibility, Journal Year: 2023, Volume and Issue: 15(3), P. 305 - 319

Published: Nov. 20, 2023

Purpose This study aims to examine the effect of environmental, social and corporate governance (ESG) scores on stock markets for period from February 2018 December 2022 G7 countries. Even though ESG is an established area investigation, prior research has paid inadequate attention nexus in (Germany, USA, UK, Italy, France, Japan Canada) Design/methodology/approach covers countries uses a data set, which includes market returns reporting channels including financial websites, international indexes, between 2022. Cross-section dependency homogeneity tests were used with Konya (2006) panel causality test investigate relations markets, also conducted separate analysis each sub-dimension. Homogeneity/heterogeneity carried out research. Findings The findings suggest that (DAX) was determined only Germany. Accordingly, it understood German companies have started implement responsibility practices their management strategies reporting. These offer important implications those who are considering investing countries, whether or not consider scores. Originality/value In this context, contributes existing literature relationships seen as vital tool meet expectations stakeholders.

Language: Английский

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Tools for considering ESG factors in business valuation

Procedia Computer Science, Journal Year: 2023, Volume and Issue: 225, P. 4245 - 4253

Published: Jan. 1, 2023

As an indicator of the sustainability company's development, its value is proposed, reflecting dynamics financial health company and ability management to create for shareholders other stakeholders. An increase in enterprise can serve as improving production efficiency, introducing new technologies processes, increasing customer base diversifying business. The applicability business integral sustainable development substantiated. hypothesis considered that framework assessment, influence ESG factors should be taken into account by adjusting cash flows discount rate risks obtaining (forming) these flows, while risk accounting areas correctly divided order avoid double accounting. expediency calculating validity a block shares or share sale (Discount lack marketability (illiquidity), DLOM) when evaluating business, instead on liquidity, has been proved, which, making final adjustments, calculated using multiplicative formula together with non-controlling nature shares; are proposed "Mandelbaum factors". conducted research applied practical tasks context vector enterprises economy.

Language: Английский

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