Abstract
As an important enterprises’ practice in implementing the UN 2030 sustainable development, environmental, social, and governance (ESG) performance has drawn escalating attention from government, business and academia. This focus substantially impacts internationalization of enterprises. This paper tries to provide quantitative evidence of the impact of ESG performance of Chinese A-share listed companies on their international operation from 2009 to 2021. The results show that: (i) the ESG performance of listed enterprises exercise a significant positive impact on the internationalization operation. (ii) The effect of ESG performance on enterprises internationality is driven by increasing total factor productivity, enterprise reputation, and green innovation, as well as by mitigating financing constraint. (iii) Good ESG performance significantly boosts enterprise internationalization for non-heavy polluting, large-scale enterprises. This effect is also pronounced for enterprises with local government reports featuring a high frequency of environmental terms or those in high-tech industries.
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