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The aim of this research paper is to analyze the connection between ESG performance and financial performance within the real estate sector. By focusing on ESG ratings and pillar scores as proxies for ESG performance, the study investigates how these factors impact both profitability and market indicators.

With data sourced from over 680 publicly listed real estate companies, the research employs a fixed effects regression model to analyze the findings. By utilizing this method, the study can assess the impact of governance, environmental and social factors on both the accounting and market performance of real estate companies.

The outcomes of this study underscore a link between sustainability, particularly environmental aspects and financial performance. However, the study also reveals a contrasting result: governance factors are associated with adverse financial outcomes. Nevertheless, it is important to highlight the limitations as the results present a mixed picture with limited significant findings.

Companies should prioritize improvements in environment to boost profitability, while they should carefully consider the costs and benefits associated with enhancing their governance structure.

By focusing on this industry and adopting a global perspective, the study addresses a gap in the literature. The research’s innovative approach to utilizing ESG ratings and pillar scores as proxies for ESG performance enhances its originality. Furthermore, the research’s identification of the differing impacts of environmental and governance factors on financial outcomes add novel perspectives to the discourse.

In the global context, artificial intelligence (AI) technology and environmental, social and governance (ESG) have emerged as central drivers facilitating corporate transformation and the business model revolution. This paper aims to investigate whether and how the application of AI enhances the ESG performance of enterprises.

This study uses panel data from Chinese A-share listed companies spanning the period from 2012 to 2022. Through a multivariate regression analysis, it examines the impact of AI on the ESG performance of enterprises.

The findings suggest that the application of AI in enterprises has a positive impact on ESG performance. Internal control systems within the organization and external information environments act as mediators in the relationship between AI and corporate ESG performance. Furthermore, corporate compliance plays a moderating role in the connection between AI and corporate ESG performance.

This paper underscores the pivotal role played by AI in enhancing corporate ESG performance. It explores the pathways to improving corporate ESG behavior from the perspectives of internal control and information environments. This discussion holds significant implications for advancing the application of AI in enterprises and enhancing their sustainable governance capabilities.

This study aims to investigate the effects of board cultural diversity (BCD) and board gender diversity (BGD) of the board of directors on environmental, social and governance (ESG) performance in the European banking sector using resource-based view (RBV) theory. In addition, this study analyses the linkages between BCD and BGD and knowledge sharing on the board of directors to improve ESG performance.

This study selected a sample of European-listed banks covering the period 2021. ESG and diversity variables were collected from Refinitiv Eikon and analysed using the ordinary least squares model. This study was conducted in the European context regulated by Directive 95/2014/EU, which requires sustainability disclosure. The original population was represented by 250 banks; after missing data were excluded, the final sample comprised 96 European-listed banks.

The findings highlight the positive linkages between BGD, BCD and ESG scores in the European banking sector. In addition, the findings highlight that diversity contributes to knowledge sharing by improving ESG performance in a regulated sector. Nonetheless, the combined effect of BGD and BCD negatively impacts ESG performance.

To the best of the authors’ knowledge, this is the first study to measure and analyse a regulated sector, such as banking, and the relationship between cultural and gender diversity for sharing knowledge under the RBV theory lens in the ESG framework.

This study provides evidence that financial performance becomes a foundation of environmental, social, and governance (ESG) activities, and it will be appreciated positively by the market through the firm value. This examination is triggered by different views of ESG activities, such as philanthropy, doing business ethically, the indirect benefit for shareholders, or maintaining reputation. Therefore, it causes differences in ESG activity appreciation by market. Meanwhile, corporate social responsibility (CSR) activity is voluntary in Indonesia, so this activity aims to maintain reputation or avoid risk allegations according to environmental and social abuse. This study predicts that a stable firm’s financial performance concerns environmental and social issues. This study uses 139 companies from Indonesian Stock Market Data from 2013 to 2019, which fulfill the criteria of Thompson Reuters for ESG score. The empirical evidence shows that firm financial performance influences ESG score consistently as the antecedent. Further, ESG performance mediates the effect of firm financial performance on firm value. This research contributes to stakeholder theory, CSR practice, and good governance.

The purpose of this study is to investigate whether the corporate environmental, social and governance (ESG) performance of enterprise is influenced by the enterprise digital transformation. In addition, this study explains how enterprise digital transformation affects ESG performance.

The sample covers 4,646 nonfinancial companies listed on China’s A-share market from 2009 to 2021. The study adopts the fixed-effects multiple linear regression to perform the data analysis.

The study finds that enterprise digital transformation has a significant inverted U-shaped impact on ESG performance. Moderate digital transformation can improve enterprise ESG performance, whereas excessive digital transformation will bring new organizational conflicts and increase enterprise costs, which is detrimental to ESG performance. This inverted U-shaped effect is more pronounced in industrial cities, manufacturing industries and enterprises with less financing constraints and executives with financial backgrounds. Enterprise digital transformation mainly affects ESG performance by affecting the level of internal information communication and disclosure, the level of internal control and the principal-agent cost.

The government should take multiple measures to encourage enterprises to choose appropriate digital transformation based on their own production behaviors and development strategies, encourage them to innovate and upgrade their organizational management and development models in conjunction with digital transformation and guide them to use digital technology to improve ESG performance.

This study shows that irrational digital transformation cannot effectively improve the ESG performance of enterprises and promote the sustainable development of the country. Enterprises should carry out reasonable digital transformation according to their own development needs and finally improve the green and sustainable development ability of enterprises and promote the sustainable development of society.

This study examines the relationship between enterprise digital transformation and ESG performance. Different from the linear relationship between the two in previous major studies, this study proves the inverse U-shaped relationship between enterprise digital transformation and ESG performance through mathematical theoretical model derivation and empirical test. This study also explores in detail how corporate digital transformation affects ESG performance, as well as discusses heterogeneity at the city, industry and firm levels. It is proposed that enterprises should take into account their own characteristics and carry out reasonable digital transformation according to their development needs.

The banking industry faces increasing scrutiny from stakeholders regarding its environmental and social impacts, given its crucial role in fostering economic growth. Banks have been encouraged to adopt environmental, social and governance (ESG) practices to mitigate risks and safeguard their reputation. However, the effectiveness of ESG sensitivity within the banking industry is contingent upon ownership and structural factors. The extent to which banks can integrate ESG considerations into their operations and decision-making processes may vary based on their ownership structures. Therefore, this study aims to examine if the impact of ESG on the performance of Indian banks varies between private and public sector banks.

The study employs six years of panel data from two separate samples of 12 private sector banks and 10 public sector banks in India. It utilises fixed and random effect estimation techniques with robust standard errors to derive accurate and reliable econometric results.

The main findings of this study reveal intriguing insights into the relationship between ESG factors and bank performance, considering the influence of ownership structure. For private sector banks, the ESG composite score, particularly the social dimension, negatively impacts financial performance. However, there is a contrasting positive effect on efficiency. In contrast, public sector banks demonstrate a positive and significant association between the environmental score and return on equity and non-performing assets.

The findings highlight the need for tailored strategies that align with ownership structure to achieve sustainable financial and societal outcomes in the banking industry. Furthermore, it emphasises the need for private-sector banks to streamline their ESG initiatives, especially in the social dimension, to mitigate negative impacts on their financial performance.

This study introduces a novel dimension by addressing the “one size fits all” bias in prior research that overlooked bank ownership differences when examining the impact of ESG factors on bank performance.

The authors examine one special focus of Special Purpose Acquisition Companies (SPACs), namely environmental, social and governance (ESG) related investments. The authors document the performance of SPACs with and without ESG focus.

The authors collect data, from several sources, on 1,737 SPAC IPOs formed between 2003 and 2022. A SPAC's focus on ESG is classified based on declared focus in Securities and Exchange Commission (SEC) filings and in post-merger annual reports. The authors examine operational and financial performance of SPACs with and without ESG focus.

In the study's sample, only 50% of SPACs that announced an intention to acquire an ESG target ended up consummating a merger with an ESG private firm. ESG SPACs exhibit worse operating performance than non-ESG SPACs. Furthermore, they experience 11.6% lower 1-year post-merger excess returns than their non-ESG counterparts.

The study provides an examination of ESG firms that came to market via mergers with SPACs, which is an alternative method to traditional initial public offerings (IPOs). The study also provides a comparison of both operational and stock performance of ESG and non-ESG SPACs.

This paper aims to investigate how a US firm’s political landscape affects the integration of environmental, social and governance (hereafter ESG) measures in CEO compensation contracts, thereby affecting the firm’s ESG performance and credit rating.

Based on the results of state senatorial and presidential elections and the location of a US firm’s headquarters, the authors categorize whether a firm has a political environment that is predominantly Democratic (blue) or Republican (red). The empirical analyses are based on a sample of US firms in the period 2014–2021.

The authors find that firms in blue states are more likely to link CEO compensation to ESG performance measures. Further, the results show that firms in blue states with ESG-linked compensation contracts have better ESG performance. Lastly, the authors find evidence that a firm’s ESG performance has a positive impact on its credit rating, but the impact is weakened if firms in red states link ESG performance to executive compensation.

To the best of the authors’ knowledge, this is the first research that explores how a firm’s political environment affects the use of ESG performance measures in CEO compensation contracts. Furthermore, the authors contribute to the literature by showing evidence that the political environment interacts with the impact of ESG-linked compensation incentives on the firm’s ESG performance and, thus, its credit rating.

This study aims to investigate whether and how public air environmental concern (PAEC) affects corporate environmental, social and governance (ESG) performance in emerging markets.

This study measured PAEC using the Baidu index search keyword “雾霾 (PM2.5)” and assessed its impact on corporate ESG among Chinese A-share listed companies from 2011 to 2020 through regression analysis.

The empirical results indicate a positive relationship between PAEC and corporate ESG. Moreover, PAEC facilitates enhanced corporate ESG performance by mediating through corporate reputation and government environmental regulations. Heterogeneity analysis shows that the promotion effect of PAEC on ESG is more pronounced in the subgroups of companies with an excellent green image, low perceived uncertainty, strong management political connections, low short-termism, high industry technological levels and low pollution levels.

The practical implications of this study underscore the importance for policymakers, investors and companies to prioritize PAEC and its influence on corporate ESG performance.

This study contributes to ESG literature by highlighting the positive impact of external oversight, such as PAEC.

This study aims to investigate whether integrating environmental, social and governance (ESG) practices mediates the relationship between executive incentive compensation and the financial performance of Islamic and conventional banks in the Middle East and North Africa (MENA) region.

This study used multiple regression models to analyze the effectiveness of ESG practices as a mediating variable in explaining the relationship between executive incentive compensation and banks’ financial performance between 2015 and 2021. The sample consisted of 57 Islamic and conventional banks operating in the MENA region, and the data were collected from the Thomson Reuters database (Data Stream).

This research paper showed the positive and significant mediating effect of the ESG practice on Banks’ financial performance. Thus, banks’ financial and stock market profitability is influenced by ESG information disclosure. This finding shows that taking ESG into account improves the relationship between executive incentive compensation and banks’ financial performance.

The results may interest academic researchers, regulators and policymakers and would support stakeholders and decision-makers who wish to discover how executive incentive compensation affects financial performance in banks.

This study contributes to previous literature by studying the mediating effect of ESG practices on the relationship between executive incentive compensation and banks’ financial performance. Indeed, the originality of this research paper is justified by the scarcity of studies and, to the best of the authors’ knowledge, constitutes one of the first attempts to examine this relationship via a mediating variable, i.e. ESG.