The Impact Of Environmental, Social And Corporate Governance On The Financial Performance Of Listed Companies

ESG is an investment philosophy that focuses on corporate environmental,social and governance performance rather than financial performance.As a major participant in the market economy,companies are often an important source of environmental pollution while providing products and services.Therefore,promoting companies to perform environmental and social responsibilities in their production and operation activities is an effective way to manage from the source.As synonymous with green economy,ESG investment philosophy can help enterprises to develop green and sustainable.This article does an in-depth study on the relationship between ESG and corporate financial performance,with the purpose of exploring the economic value of ESG and finding a new path for the healthy and stable development of enterprises and the improvement of financial performance.This article first reviews the development background of ESG and points out the necessity and importance of research.Then the concept of ESG was defined,and the objectives and content of the research were clearly defined.Then it describes the research ideas and research methods involved in this article.The literature review part presents the ESG-related theories currently occupying the mainstream position,such as sustainable development theory,stakeholder theory,and principal-agent theory,and points out the theoretical basis of ESG.Then it analyzes the related literature on the relationship between E,S,G performance and financial performance respectively,and the related literature on the relationship between ESG comprehensive performance and financial performance.Secondly,based on theoretical analysis and combined with previous research experience,put forward research hypotheses.Taking the constituent companies of the CSI 300 Index from 2016 to 2019 as a sample,and Huazheng ESG data are selected,and then empirically tested the impact of ESG on financial performance through cross-sectional data analysis and panel data analysis.The research shows that environmental,social,and corporate governance(ESG)have a positive impact on corporate financial performance in the short and long term,and the impact of changes over time is more significant.As the shortcomings of the "development first,then governance" "make money then donate" model become increasingly prominent,many corporate management’s views on the prioritized ESG and corporate development needs to be changed.The research results of this article can help companies and stakeholders understand the significance and impact of participating in ESG.Encourage companies to consciously implement ESG concepts from the perspective of obtaining economic benefits.It is recommended that companies internalize ESG concepts into top-level design and daily operation and management,so as to create a top-down driving force to enhance their comprehensive strength.