Abstract
An investigation into the relationship between ESG performance and firm value is vital for formulating corporate sustainability strategies. This paper begins by providing a comprehensive overview of the ESG performance across all listed companies in the Chinese stock market. It then examines the effect of a firm’s ESG performance on its firm value, with a particular focus on the heterogeneity within various industries. Our results demonstrate that ESG performance standards are positively correlated with the firm value. Enhancements in ESG performance can significantly bolster a firm’s sustainability. Nevertheless, the degree and direction of the impact of corporate ESG performance on firm value are subject to variation across industries. These results have significant implications for the refinement of corporate ESG practice initiatives and ESG-oriented investors, inspiring them to consider the industry classification of firms in their operational and investment strategies related to ESG.
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