scholarly journals Understanding the Impact of ESG Practices in Corporate Finance

2021 ◽  
Vol 13 (7) ◽  
pp. 3746
Author(s):  
Sang Kim ◽  
Zhichuan (Frank) Li
Keyword(s):  
Financial Performance ◽  
Financial Risk ◽  
Credit Rating ◽  
Social Factor ◽  
Positive Influence ◽  
Corporate Financial Performance ◽  
The Social ◽  
Negative Effect ◽  
The Impact ◽  
The Relationship

This study examines the relationship between environmental, social, and governance (ESG) factors and corporate financial performance. Specifically, we study various individual ESG categories, both ESG strengths and concerns, and aggregate ESG factor and their impact on corporate financial performance including profitability and financial risk. We find a positive effect of ESG factors on corporate profitability, and the effect is more pronounced for larger firms. Among different ESG categories, corporate governance has the most significant impact, particularly for firms with weak governance. We also find that ESG variables generally have a positive influence on credit rating. In particular, the social factor has the most significant impact on credit rating, while environmental score surprisingly has a negative effect. Overall, this research provides a rationale for ESG integration in the context of investment management and portfolio construction to maximize value and minimize risk.

scholarly journals Desempenho social e financeiro de pequenas e médias empresas: modelo conceitual de causa e efeito

2016 ◽  
Vol 15 (2) ◽  
pp. 60-70
Author(s):  
Jose Elenilson Cruz ◽  
Rafael Barreiros Porto
Keyword(s):  
Financial Performance ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Empirical Studies ◽  
The Social ◽  
Research Propositions ◽  
Object Of Study ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

Corporate social performance can be understood as a way to measure the efficiency of interactions between companies and their main stakeholders. This evaluation has led to some steps forward in research and management implications. One of its main issues, which is the study of the relationship between social and financial performance, focuses on traditional joint-stock companies. This fact reveals a gap concerning the object of study in the literature of the area. The importance of investigating small and medium companies (SMCs) lies in their social and economic relevance and also in new evidences these studies may provide. After the theoretical discussion, this study presents a conceptual model composed of research propositions to be tested by future empirical studies that wish to answer the following question: in small and medium companies there are relations of cause and effect between social and financial performance? The test of the proposals suggested can reveal, among other results, the categories of social performance of SMCs most affected by a higher financial performance, as established by the premises of theoretical slack-resources; if the impact of these categories on the financial performance is qualified by way of management, confirming assumptions of the theory good management, or if there are no significant differences between the social performance of SMEs with higher financial performance and SMEs with low financial performance, revealing the existence of non-financial factors also influence social performance.

scholarly journals Impact of Companies’ Characteristics on the Relationship between Corporate Social Responsibility Disclosure and Corporate financial Performance - An Empirical Analysis

2021 ◽  
Vol 39 (7) ◽  
Author(s):  
Sayeed Zafar Qazi ◽  
Parvesh Kumar Aspal
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Empirical Support ◽  
Corporate Financial Performance ◽  
Economic Point ◽  
Corporate Social Responsibility Disclosure ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

Strategic managers are persistently accosting with the decision of switching the scared corporate resource for the community welfare to balance the shareholders’ and multiple stakeholders’ interests. Corporate houses are presumed to not only intensify the economic priorities of investors, but must also consider the community and environmental ramifications as well. Presently, corporations are in dilemma over whether investment in corporate social responsibility (CSR) initiatives will be a cost or gain from an economic point of view. For this purpose, the association between CSR disclosure and corporate financial performance has been empirically explored and also the company characteristic has been considered as a significant and interesting factor influencing the association between CSR and corporate financial performance. The prime objective of the present paper is to examine the impact of companies’ characteristics i.e., Age of company on the relationship between corporate social responsibility disclosure and corporate financial performance. Panel data regression statistical technique has been applied to investigate and analyze the relationship. The findings of the study reveal that companies CSR have significant influence on their financial performances.  But, on the other hand the company characteristic, age of the company has no significant impact on the corporate financial performance. The findings are found consistent with earlier studies, which validate the company’s venture in undertaking the CSR initiatives. The present study addresses theoretical as well as empirical support and inspiration for the corporations towards CSR initiatives.

scholarly journals Relationship between Corporate Social Performance, Corporate Financial Performance and Financial Risk in Indian Firms

2019 ◽  
Vol 8 (3S3) ◽  
pp. 121-128
Keyword(s):  
Financial Performance ◽  
Financial Risk ◽  
Positive Relationship ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Corporate Financial Performance ◽  
Corporate Social ◽  
The Relationship

This study examines the relationship between Corporate Social Performance and Corporate Financial Performance and Financial Risk of BSE top 10 companies in India. The variables of Corporate Social Performance and Financial Performance and Financial Risk were used in this study. There was positive relationship between Corporate Social Performance, Corporate Financial Performance and Financial Risk, at Bajaj Finance Ltd, Reliance Industries Ltd, Bajaj Auto Ltd, State Bank of India, Hindustan Unilever Ltd, Asian Paints Ltd and Bharathi Airtel Ltd. The novelty of the study is that the analysis of this study focuses on CSP, CFP and Financial Risk in respect of Indian firms.

scholarly journals Promoting or Inhibiting? The Impact of Environmental Regulation on Corporate Financial Performance—An Empirical Analysis Based on China

2020 ◽  
Vol 17 (11) ◽  
pp. 3828 ◽  
Author(s):  
Xiang Deng ◽  
Li Li
Keyword(s):  
Sustainable Development ◽  
Financial Performance ◽  
Environmental Protection ◽  
Environmental Regulation ◽  
Empirical Analysis ◽  
Analytical Framework ◽  
Corporate Financial Performance ◽  
Ecological Civilization ◽  
The Impact ◽  
The Relationship

Today, environmental protection has become a global issue, and various environmental regulations have been actively adopted. However, are these measures promoting or harming enterprise values? Is this effect the same for enterprises with different ownership backgrounds? In order to address these problems, we conducted an empirical analysis of China’s A-share market to investigate the relationship between the New Environmental Protection Law (NEPL) launched in China and corporate financial performance, and further explore the impact of environmental supervision intensity (ESI) from the perspective of ownership. The empirical results show that there is a negative correlation between NEPL and the financial performance of high pollution enterprises. Further analysis demonstrates that there is an inverted U-shape relationship between ESI and corporate financial performance for both state-owned enterprises (SOEs) and non-state-owned enterprises (non-SOEs), while the financial performance of SOEs is more sensitive and tolerant to environmental regulation than that of non-SOEs. Finally, we make recommendations for the future direction of China’s ecological civilization construction and sustainable development of enterprises based on three aspects: environmental awareness, policy considerations, and sustainable development. The innovation of this paper lies in putting NEPL and corporate financial performance in the same analytical framework for the first time, which enriches the research in this field. Meanwhile, it provides a new perspective for understanding the relationship between ESI and corporate financial performance through the analysis of nonlinearity and owner heterogeneity.

scholarly journals CORPORATE GOVERNANCE: THE GATEWAY TO A ROBUST CORPORATE FINANCIAL PERFORMANCE IN MALAYSIA

2020 ◽  
Vol 8 (7) ◽  
pp. 91-98
Author(s):  
Khairi Aseh ◽  
Kamal Kenny ◽  
Ravindran Pathmanathan
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Global Financial Crisis ◽  
Descriptive Analysis ◽  
Corporate Financial Performance ◽  
Board Committees ◽  
Corporate Scandals ◽  
The Global Financial Crisis ◽  
The Impact ◽  
The Relationship

In recent years, with corporate scandals and the global financial crisis, the emerging concept of corporate governance has received increasing attention in the corporate world in these days. It is seen as a moral obligation and includes supporting the consistency of the law and showing ethical guidance. Corporate governance is seen as an important tool for the financial performance of companies, and investor investment decisions have become a more serious topic, so the relationship between corporate governance tools and measurement of financial performance has attracted researchers' interest in the past decade mainly in developed and developing cities. In this study, we attempted to examine the impact of corporate governance on corporate financial performance in Kuala Lumpur using a sample of 215 companies on KLSE. Like previous research, firm, age, firm size, board size, CEO duality, board composition, board committees is the independent variables and their influence is to measure the financial ROA, ROE and Tobin's q , all kinds of test is used to investigate the relationship such as descriptive analysis, Pearson moment related test and regression using first data over a period of time.

The impact of employee involvement on small firms' financial performance

1999 ◽  
Vol 169 ◽  
pp. 78-95 ◽  
Author(s):  
Alex Bryson
Keyword(s):  
Financial Performance ◽  
Small Firms ◽  
Large Firm ◽  
Employee Involvement ◽  
Industrial Relations ◽  
Level Data ◽  
Negative Effect ◽  
The Impact ◽  
The Relationship ◽  
Do So

The author examines the relationship between employee involvement (EI) and small firms‘ financial performance using statistical analyses of establishment-level data from the 1990 Workplace Industrial Relations Survey. The author finds EI practices and EI combinations which ‘work’ for small-firm establishments are very different from those that work for large-firm establishments. The least bureaucratic and least costly EI methods have the potential to benefit small firms most. Whether they actually do so depends on the array of other EI and non-EI practices in operation: an inappropriate configuration can have a negative effect on performance. The findings take account of factors associated with being an ‘EI firm’.

scholarly journals EFFECTS OF ORGANISATIONAL STRUCTURE ON SOCIAL VALUE: MEDIATING ROLE OF FINANCIAL PERFORMANCE

2018 ◽  
Vol 17 (3) ◽  
pp. 131
Author(s):  
NUR AIMA SHAFIE ◽  
ZURAIDAH MOHD SANUSI ◽  
RAZANA JUHAIDA JOHARI ◽  
WIWIK UTAMI ◽  
AZIATUL WAZNAH GHAZALI
Keyword(s):  
Financial Performance ◽  
Social Enterprise ◽  
Social Value ◽  
Organisational Structure ◽  
Mediating Role ◽  
The Social ◽  
The Government ◽  
The Impact ◽  
The Relationship

Social enterprise (SE) is a hybrid organisation, which combine two different goals in their mission and vision. In an attempt to sustain their operation, social enterprise must ensure that both mission (social and financial) is equally balanced and achievable. The existence of SE is to fill the gap leave behind by traditional profit organisation, non-profit organisations (NPOs) and the government. The aim is to positively impact the social, cultural and environmental issues through their unique business model. Their uniqueness, while can benefit the community and society as a whole is prone to fraud and misuse of funds which would eventually affect the survival of SE. The issues are originated from weak governance particularly the structure of their organisations. Hence, this study is aims to examine the relationship between the organisational structure, financial performance and social value of SE in Malaysia. On the other hand, the study also aim to examine the mediating role of financial performance on the relationship between organisational structure and social value. Organisational structure is vital as carefully selected, well designed and well managed organisational structure will improve the impact of social enterprise on the society. This study is based on the 134 data obtained from the SE in Malaysia and registered as Company Limited by Guarantee (CLBG). The study found that, organisational structure and financial performance significantly influence the social value of SE. Furthermore, it was also found that financial performance indeed mediate the relationship between organisational structure and social value. It is hoped that the study can contribute to the improvement of performance of SE in Malaysia and as well as encourage the development of research in the area of SE.

scholarly journals Social Dimensions of Green Economy

2019 ◽  
Vol 30 (2) ◽  
Author(s):  
Nataliia Stukalo ◽  
Anastasiia Simakhova
Keyword(s):  
Positive Influence ◽  
Green Economy ◽  
Social Dimensions ◽  
Social Approach ◽  
Social Sphere ◽  
Green Development ◽  
The Social ◽  
Key Features ◽  
The Impact ◽  
The Relationship

The article analyses the social approach to the concept of ‘green’ economy. The key features of sociology of the ‘green’ economy have been presented. The basic spheres, in which it is possible to trace the relationship between ‘green’ economy and social being, have been traced. The impact of the ‘green’ development on education, health, employment and population wellbeing has been explored. The main promising directions of enhancing the positive influence of the development of ‘green’ economy on the social sphere have been proposed.

scholarly journals The Relationship between Capital Structure and Financial Performance of the Company

2021 ◽  
Vol 91 ◽  
pp. 01002
Author(s):  
V.V. Tretiakova ◽  
M.S. Shalneva ◽  
A.S. Lvov
Keyword(s):  
Pharmaceutical Industry ◽  
Capital Structure ◽  
Financial Performance ◽  
Order Theory ◽  
Pecking Order ◽  
Pecking Order Theory ◽  
Market Capitalization ◽  
Negative Effect ◽  
The Impact ◽  
The Relationship

The article examines and analyzes the relationship of key performance indicators (ROA, ROIC, change in market capitalization and price-to-book ratio) and the capital structure of the company based on the pharmaceutical industry in the UK for the 2009-2019 period. The study seeks to provide a practical evidence on the impact of external financing on company’s financial performance and test applicability of the pecking order theory for the chosen companies. The research conducted uses panel data regression and Wald test to determine and analyze the effect of capital structure on the financial indicators of the company performance. The study used a sample of 185 UK companies from the pharmaceutical industry. The result of the research showed that equity has negative effect on price-to-book ratio and ROA and positive effect on change in market capitalization, while long-term debt has a positive relationship with price- to-book ratio and change in market capitalization. In addition, short-term debt has a negative effect on change in market capitalization, ROA and ROIC. The study also provides only partly coincidence of the results with the pecking order theory.

scholarly journals The Impact of the Economic Crisis on the Environmental Responsibility of the Companies

2021 ◽  
Vol 15 ◽  
pp. 27-31
Author(s):  
M.M. Miras ◽  
B. Escobar ◽  
A. Carrasco
Keyword(s):  
Social Responsibility ◽  
Financial Performance ◽  
Economic Crisis ◽  
Environmental Behavior ◽  
Environmentally Friendly ◽  
Environmental Responsibility ◽  
Corporate Financial Performance ◽  
The Social ◽  
The Impact

The severe economic crisis is affecting significantly to the environment in which companies have to continue with their business. Consequently, academicians and managers are worried about what is going to happen with the Social Responsibility and particularly with the Environmental Responsibility, due to the decrease in the financial performance of the companies. The aim of this paper is to study the effect of the crisis on the environmental behavior of the Spanish companies through an explicative study, deepening in the comparison between the years 2006 and 2010. As a result, Spanish companies continue carrying out behaving in an environmentally friendly way because their Environmental Scores are growing, despite the decline of the Financial Performance. Moreover, it is identified a change in the factors that affect to the environmental behavior due to the identification of less dependence on corporate financial performance.

Sign in / Sign up

Export Citation Format

Share Document