Role of ESG Investment on Firm's Performance: An Empirical Study of Experts' Opinion

Abstract

The performance of Indian enterprises has been considerably impacted by investments in Environmental, Social, and Governance (ESG). Businesses may increase their sustainability and resilience and draw in more investors by incorporating ESG concepts into their operations. Responsible business practices are encouraged by ESG standards and frequently lead to lower operational risks, better brand recognition, and higher long-term profitability. As investors place a higher value on ethical and sustainable investments, Indian companies that embrace ESG aspects typically show greater financial success. Additionally, following ESG guidelines in India promotes credibility and trust among stakeholders by being in line with societal norms and legislative changes. This proactive strategy not only reduces the negative effects on the environment and society, but it also increases investor trust, which may minimize these companies' cost of capital. To put it simply, ESG investments in India have propelled businesses forward by providing not only monetary gains but also a constructive influence on the environment and society, which in turn drives continued expansion and market competitiveness. Study survey was conducted among 193 experts from financial and investment sector to know their opinion regarding the role of ESG investment and its impact on Firm's Performance and conclude that there is significant impact of ESG investment on performance of a firm.