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Can ESG Performance Improve Corporate Resilience? - An Empirical Study based on A-Share Listed Companies

Author(s)

Ji Hao

Affiliation(s)

Xi'an International Studies University, School of Economics & Finance, Xi’an, Shaanxi, China

Abstract

In the context of the enhanced development of global sustainable investment, ESG rating accelerates the transformation of corporate governance systems. We choose Shanghai and Shenzhen's listed companies in the period of 2011-2023 as the sample, establish a two-way fixed effects regression model to examine the effect of corporate ESG performance on corporate resilience and the mechanism, and come to the conclusion that corporate ESG performance can effectively promote corporate resilience, and the conclusions are robust to a series of robustness checks and endogeneity checks. Further mechanism analysis finds that corporate resilience is promoted by corporate ESG performance through enhancing the quality of human capital, the quantity of government subsidies, and green innovation performance. Heterogeneity checks indicate the effect of enhancing corporate resilience by corporate ESG performance is heterogeneous in different types of enterprises. This promoting effect is more significant in enterprises owned by the state, better internal control quality, and inferior external auditors' quality. This research supports the legitimacy of the role of corporate ESG performance in promoting corporate resilience, deepens empirical study on the micro effects of corporate ESG performance, and provides empirical support for the formulation of corporate strategies and the upgrade of China's policy system.

Keywords

ESG Performance; Enterprise Resilience; Fixed Effect Model; Mechanism Test; Heterogeneity Analysis

References

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