Research On The Correlation Between ESG Performance Of Listed Companies And Corporate Financial Performance

In recent years,based on sustainable development theory,stakeholder theory and principal-agent theory,as the government has introduced more and more green financial policies and the domestic ESG system has developed,more and more companies no longer focus on corporate financial performance.development,and began to pay attention to its own performance in environmental performance,social responsibility and corporate governance.For investors,since ESG performance may be related to the long-term survival and development of enterprises,it is necessary for investors to pay attention to the ESG performance of enterprises,especially its relationship with the financial performance of enterprises.However,at present,due to the late start of domestic ESG development,a relatively mature ESG research system has not yet been formed,and there are still relatively few studies on ESG disclosure,rating and correlation with other elements of enterprises.The impact is empirically studied as an extension of theoretical and empirical research in this area.This paper first expounds the concept connotation and related theories of ESG and corporate financial performance,sorts out and summarizes relevant domestic and foreign literature,and based on the existing literature research,innovatively designs the research content and methods of this paper.It is the impact of ESG as a whole rather than a single factor or two of them on the financial performance of the company.In the measurement of the financial performance of the company,it does not use the traditional single indicator,but innovatively selects the ability to reflect the four aspects of the company’s financial performance.The ten accounting indicators are calculated by the principal component factor analysis method to obtain comprehensive indicators to measure the financial performance of enterprises.Therefore,this paper takes the ESG rating data of 825 domestic listed companies in the past five years and related financial data as the main research objects to carry out an empirical analysis.First,this paper uses the principal component factor analysis method to reflect the profitability and development of enterprises.The 10 main indicators of the four aspects of ability,operating ability and solvency are integrated into a variable that reflects the overall situation of financial performance,and then the enterprise size,enterprise age and equity concentration are used as control variables to establish ESG performance and financial performance.The two-way fixed-effect model and the system GMM dynamic panel model were used to explore the interactive intertemporal relationship between the two.The results of the study found that ESG performance in the current period and one lag period had a positive effect on financial performance,and financial performance also had a positive effect on ESG performance,but with a lag.Therefore,this paper puts forward some countermeasures and suggestions from the three levels of government,enterprise and society at the end.It believes that the government should strengthen the guidance of ESG-related systems and ESG concepts,and enterprises should reasonably balance the relationship between ESG and financial performance according to their own characteristics.Taking the road of sustainable development,the general public should also consciously integrate ESG concepts into their daily life and consumption,forcing companies to perform better in ESG development.