Research On The Impact Of ESG Rating Standards On Enterprise Value

With the frequent occurrence of negative incidents of environmental pollution and social responsibility,the ESG investment concept is increasingly valued.Compared to mature ESG rating systems abroad,China’s ESG rating started relatively late but developed rapidly.ESG rating information conveys new information signals to the financial market that affect decision-making,affecting investors’ market judgments of corporate value.At present,there are many ESG rating agencies in the market,and ESG rating standards are essentially the ESG rating indicator systems constructed by different ESG rating agencies.The market’s response to ESG rating information,represented by enterprise value,can reflect the current maturity of China’s ESG rating market and the development of sustainable development investments based on ESG ratings in China by understanding the attitude of the capital market towards ESG ratings,especially towards different ESG ratings.This has very positive theoretical and practical significance for exploring the effectiveness of China’s ESG financial market,maintaining a healthy financial market,and using financial markets as a means to maintain a good ESG public environment.This thesis first reviews the existing literature on ESG,then introduces the concept of ESG rating,and summarizes the current development status of ESG rating in China from four aspects: development opportunities,financial field applications,other practical applications,and evaluation of ESG rating in the capital market.On this basis,combined with sustainable development theory,signaling theory,etc.,a three-dimensional and multi angle analysis framework of the impact of short-term and long-term,single ESG rating and differentiated ESG rating on enterprise value is constructed,which is specifically shown in the following three aspects: First,select Wind ESG rating results,which have a strong impact on China’s capital market,as the observation entry point,and analyze the market response to ESG rating announcement events through the event study method,and further classify the samples according to the nature and level of pollution,and use the calculated excess return rate as a measurement indicator to analyze the impact of ESG rating on short-term corporate value;Secondly,construct an industry and time fixed effects model,select Huazheng ESG rating and other variable indicators,analyze the impact and mechanism of ESG rating on long-term corporate value,and further analyze the impact of ESG rating on long-term corporate value under different classification samples with different pollution properties,property rights properties and audit properties;Thirdly,by constructing an industry and time fixed effects model,we selected four ESG ratings: Wind,Huazheng,Shangdaoronglv,and FTSE Russell.We first examined whether different ESG ratings had different impacts on long-term corporate value,and further screened common and "highly divergent" samples covered by the four institutions to examine the relationship between average ESG ratings and highly divergent corporate value,Finally,examine which institution’s results and ESG rating standards are more suitable for analyzing companies with "high divergence".The research results found that: firstly,the announcement event that the Wind ESG rating covered CSI 800 did not cause market reaction,but the announcement event that the rating covered all A-shares caused a strong positive reaction in the market.Further research found that the market reaction was stronger for heavily polluting enterprises and stocks with lower rating results.Both raising and lowering the Wind ESG rating results had a positive effect,but the positive effect of the raising group was stronger;Secondly,there is a significant positive relationship between ESG ratings and corporate value,indicating that investors in China’s capital market have formed a positive preference for ESG rating information.The capital market can actively choose excellent performance in ESG management,and the "rating down value" plays a negative moderating role in the impact of ESG ratings on the value of non rising sample enterprises.Further research has found that the ESG ratings of heavily polluting enterprises and non major international accounting firms have a greater positive impact on corporate value.Thirdly,there are differences in the impact of the four ESG rating results on long-term corporate value.The average ESG rating of the "high divergence" sample has a significant positive impact on corporate value,and Huazheng ESG rating is more suitable for analyzing "high divergence" enterprises.Finally,based on the literature analysis,empirical analysis,and identified issues mentioned above,countermeasures and suggestions are proposed from four aspects:government,rating agencies,enterprises,and investors,and the shortcomings of this study are explained.