Directions of improving the corporate management of agricultural enterprises based on sustainable development

Abstract

The article is devoted to substantiating the importance of sustainable development for corporate management of agricultural enterprises. It is shown that the principles of sustainable development of the agricultural sector are essential for modern agricultural holdings and the state. The peculiarities of implementing environmental, social, and governance (ESG) components into the corporate strategies of agricultural enterprises are revealed. It is shown that ESG investments contribute to the growth of long-term investment attractiveness and market capitalization. Research on investment decisions based on environmental, social, and governance criteria is revealed. The paper shows that companies with high ESG ratings and low ESG risks attract more investment. Based on a critical analysis of scientific sources, it has been proven that socially responsible companies have higher growth rates in the share price on the stock exchanges and market value. ESG investments in corporations create additional value and increase the value of intangible assets, particularly business reputation, brand, and human capital. The role of reputation management, corporate image, and business reputation in the growth of the market capitalization of a corporate agricultural enterprise is revealed. It is shown that high requirements for non-financial reporting and disclosure of activities in ESG areas require issuers to form an open and transparent system of communications with investors and stakeholders and to constantly work on reputation compliance with the principles and ethics of corporate governance. It was outlined that Ukrainian agricultural enterprises should integrate the principles of sustainable development into their corporate strategies, work on improving corporate governance, and implement successful reputation management experience for stable growth of market capitalization and business. Public agricultural enterprises must implement ESG principles in the corporate governance system, join global initiatives and sustainable development ratings, report on the results of activities according to international standards, and maintain an appropriate level of media activity and communications with key stakeholders. Keywords: sustainable development, corporate governance, agricultural sector, corporate agricultural enterprises, ESG principles.