Research On The Effect Of Enterprises’ ESG Score On Total Factor Productivity Of Enterprises

As the carbon peaking and carbon neutrality goals has been consensus in the global,our country also regard the target which we need to reach carbon peak by 2030 and carbon neutral by 2060 as national strategy,which also means our country’s energy structure turn to low carbon and finance will also be turn to green as support to combine the real economy with the target.Accordingly,China has introduced a series of policies to support ESG-themed investment,making the concept of ESG has been noticed by the market.In the academics,many scholars have started to study ESG,focusing on the correlation between ESG performance and enterprise value and the correlation between ESG performances and financing cost,while few have studied the relationship between enterprise ESG level and TFP.As the improvement of TFP represents the efficiency promotion caused by technology upgrading in the whole industry and the development of productivity in the whole society,it is of great significance to both society and enterprises.For the society,the improvement of TFP means that the economic efficiency of the society is improved and the economy is developing towards high quality.For enterprises,the improvement of enterprise TFP means the improvement and the sustainable development of enterprise operation.This thesis firstly analyzes the relationship between ESG and TFP from the theoretical level,using information asymmetry theory,signal theory and principal-agent theory,and discuss the mechanism of improving total factor productivity by improving ESG level.This thesis also tests the relationship between ESG and TFP in empirical way using TFP data calculated by LP method and ESG score from Hua Zheng,which is a rating agency,and other financial data in CSMAR database and Wind database.The results show that there is a significant positive correlation between ESG and TFP,and enterprises can improve their TFP by improving their ESG level.Meanwhile,this thesis also do the heterogeneity test.In terms of influencing mechanism,this thesis explores two influencing paths which is enterprise R&D innovation and enterprise agency cost.By empirical tests,it is found that the two paths all present significant mediating effects.By theoretical analysis and empirical analysis,this thesis confirms that enterprises could improve their TFP by improving ESG score.Moreover,this thesis puts forward corresponding suggestions for the development of ESG in China.As our country introduced a concept of ESG later in the western countries,the construction of the ESG system in our country is defective.So we can improve the construction of ESG system from government financial institutions and rating agency three aspects.For example,we can complete the system of ESG information disclosure;strengthen the guidance of ESG information disclosure of listed company work;combined with China’s national conditions to build the ESG rating method and develop various ESG investment tools to promote China’s ESG system construction.