Environmental, social and governance performance, corporate transparency, and credit rating: Some evidence from Chinese A-share listed companies

Abstract

The role of the companies’ environmental, social, and governance (ESG) performance plays to corporate transparency is important, but few researches have been conducted so far. This study examines the impact of the transparency mechanism of Chinese A-share listed companies over the period 2009 to 2020. The results show that: first, listed companies with substantial ESG performance are more transparent than listed companies with low ESG performance. Moreover, the high shareholding of institutional investors and the high attention of analysts will weaken the positive impact of ESG’s performance on corporate disclosure transparency. Finally, transparency plays an intermediate role in the relationship between ESG performance and credit ratings of listed companies. The findings provide guidance for regulators to supervise ESG disclosure activities of listed companies and improve the information disclosure system.