Study On The Influence Of Executive Background Characteristics On Corporate ESG Ratings

In recent years,sustainable development has become the focus of international attention.ESG,an international evaluation system for measuring corporate behavior and decision-making,contains three dimensions:Environmental,Social and Governance,and focuses on the sustainability of companies.Sustainable development is not only an inevitable requirement for the long-term survival of enterprises,but also a powerful driving force to ensure the stability of the whole economy and society.According to "ESG and Corporate Value" published by the China Association of Asset Appraisal and the International Valuation Standards Council(IVSC),ESG represents many factors for assessing the long-term financial viability and sustainability of an enterprise,and is a leading indicator of financial performance.At the same time,with the growing prominence of environmental issues,the international community has gradually reached a consensus on the concepts of "carbon peaking" and "carbon neutrality",which makes ESG an important basis for judging whether listed companies have investment value globally.The government and regulators in China are gradually reinforcing the signal that enterprises should promote ESG systematization.In this process,the ESG performance level is measured and determined by the rating scores of the institutions,therefore,the importance of ESG rating is self-evident,and it is important and necessary to study the key factors influencing ESG rating.In summary,this paper selects the data of China’s listed companies in Shanghai and Shenzhen A-shares from 2016 to 2021 as a sample,takes the political and financial backgrounds of executives as the starting point,and selects the Shang Dao Rong Green ESG rating index to explore the impact of executive background characteristics on corporate ESG ratings.In this paper,the research was conducted by using literature review,normative research and empirical analysis,among which,panel regression,group regression and moderating effect regression were used in the empirical research.In the grouped regression analysis,the impact was divided according to the different ownership of enterprises,and it was found that political background had a more significant negative impact on non-state enterprises,while financial background had a more significant impact on state-owned enterprises.In further analysis,this paper selected the average age of executives as a moderating variable and found that the average age of executives had a significant inhibitory effect on the relationship between political background and ESG ratings of firms,while it had a significant facilitative effect on the relationship between financial background and ESG ratings of firms.This paper also conducted robustness tests by using the replacement variable method,Heckman two-stage test and model replacement method,which proved the robustness of the research findings.Meanwhile,based on the research results,this paper makes the following suggestions:firstly,to improve the level of market players’ awareness of ESG ratings;secondly,to optimize the structure of the executive team and establish a sound mechanism for itself;next,to improve the construction of ESG information disclosure system;finally,to establish a standard ESG rating index system in China.