ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) PERFORMANCE, FINANCIAL CONSTRAINTS, AND CORPORATE VALUE: A QUANTILE REGRESSION ANALYSIS OF CHINESE LISTED FIRMS (CLFS)

Abstract

This work presents the correlation connection between the performance of a company in terms of environmental, social, and governance (ESG) factors value within the context of Chinese listed firms (CLFs) spanning from 2018-2022. The study, encompassing a sample size of 2269 CLFs, employs a quantile regression analysis approach to investigate the impact of ESG performance and financial constraints on the corporate value of these listed firms across various quantile levels. The findings demonstrate a correlation between sustainability performance and corporate values for companies with both low and high values. However, there is no noticeable impact detected for companies with values in the middle range. Additionally, the research concludes that financial constraints exhibit a negative relationship with corporate value for firms with low and high values, with no statistically significant impact on those with mid-range values. Furthermore, the findings suggest heterogeneous effects of both ESG performance and financial constraints on the corporate value of CLFs, supplying insights for investors, firm management, and policymakers in China.