Corporate ESG Performance,Risk-taking And Investment Efficiency

In recent years,the increasingly severe climate and environmental situation,the lack of social responsibility in the post-epidemic era and other negative events have occurred frequently,causing widespread public concern about how to achieve social sustainable development.In 2006,the United Nations Principles of Responsible Investment(UN PRI)proposed to incorporate environmental,social and corporate governance(ESG)factors into the investment decision-making process.Relevant departments and organizations at home and abroad responded in succession,actively building an ESG evaluation system to objectively measure the sustainable development ability of enterprises,and corporate ESG performance is gradually being taken seriously.Studies have shown that corporate ESG performance can affect the efficiency of corporate investment,but there is no consistent conclusion yet,and there is a relative lack of mechanism testing.Risk-taking is one of the important factors influencing corporate investment.Besides bringing good social benefits to enterprises by actively fulfilling ESG responsibilities and improving ESG performance,can enterprises further influence the investment decision-making process and improve their investment efficiency by affecting the level of corporate risk-taking?Based on corporate ESG ratings and other corporate financial data,this paper empirically examines the impact of corporate ESG performance on investment efficiency and its mechanism of action,enriching existing research findings and providing evidence to support the relevant authorities in promoting the construction of ESG systems.Using Chinese A-share listed companies from 2009 to 2019 as the research sample,the paper empirically examines the impact of corporate ESG performance on investment efficiency and introduces the mediating mechanism of corporate risk-taking to explore the ways in which corporate ESG performance has an impact on investment efficiency,while the paper further explores the variability of this impact under different situations of corporate nature,industry nature and market focus.The study finds that:(1)ESG performance can effectively inhibit inefficient investment,including a stronger inhibitory effect on over-investment,thus improving investment efficiency;(2)corporate environment,social responsibility and corporate governance performance can significantly improve corporate investment efficiency.Among them,corporate environment and social responsibility performance have a stronger inhibitory effect on over-investment than under-investment,but there is no significant difference in the inhibitory effect of corporate governance performance on the two;(3)ESG performance improves corporate investment efficiency by reducing the level of corporate risk-taking,with corporate risk-taking playing a mediating role in the process;(4)further analysis found that ESG performance of non-state-owned enterprises has a stronger inhibiting effect on overinvestment than that of state-owned enterprises;among heavily polluting enterprises,ESG performance has a weaker promoting effect on investment efficiency;however,there is no significant difference in the promotion effect between companies with more analyst and media attention.The thesis concludes with a robustness test,which shows that the above findings are robust.Based on the findings of the empirical study,the thesis puts forward relevant policy recommendations to enterprises,third-party rating agencies and relevant regulatory authorities such as the government respectively,which are of reference value for enterprises to actively undertake ESG responsibilities and improve investment efficiency,local rating agencies to improve ESG rating systems,and regulatory authorities to build ESG eco-systems and comprehensively promote sustainable social development.