Can network attention effectively stimulate corporate ESG practices?—Evidence from China

Abstract

Environmental, social, and governance (ESG) has emerged as a widespread concern for all societal segments. This study aims to explore the influence of network attention on corporate ESG practices from an investor perspective. We find that rising network attention significantly increases corporate ESG practices. Specifically, network attention plays the role of external monitoring, image promotion incentives, and mitigation of financing constraints to make companies willing to challenge ESG practices. Additionally, the promoting effect of network attention on firms’ ESG practices was more significant in higher marketization processes, severely competitive industries, and non-state enterprises. In the internet era, companies must pay attention to the flow effect caused by network attention, meet stakeholder demands, and pursue long-term sustainable development.