This paper assesses the association of ESG scores with stock returns and highlights the moderating role of the COVID-19 pandemic and the country's governance. The study uses panel data regressions to analyze how ESG performance influences plain, absolute, and risk-adjusted returns in a sample of European and selected non-European countries. These suggest that higher overall ESG scores are related positively to financial performance, and this relation is enhanced during the COVID-19 pandemic. Specifically, the two dimensions of ESG that matter most are environmental and governance. Country-level governance is important because firms in well-governed countries amplify the benefits of high ESG scores. The opposite is true for the higher Controversies scores, whose bad financial outcome is magnified during the pandemic. These results present an argument for the resilience of firm financial performance, dependent on strong ESG practices and governance frameworks. This holds great interest for investors and policymakers in associating good ESG considerations with the effective management of financial risks, leading to sustainable returns during periods of widespread economic uncertainty.

Green finance in the context of sustainable development sits within the broader discourse of environmental economics and sustainable finance. Their integration has become imperative in addressing global challenges, aiming to understand how financial mechanisms can be aligned with sustainability goals, investigating the role of green finance in promoting environmentally friendly investments and fostering sustainable development. This bibliometric analysis explores the evolution, trends, and challenges in green finance research. It examines 436 articles published between 2016 and 2024, revealing insights into influential publications, authors, journals, institutions, and countries engaged in green finance for sustainability. The study identifies China, the UK, and Pakistan as leaders in research output and citation impact. Furthermore, it highlights the interdisciplinary nature of green finance, reflected in diverse publication outlets spanning environmental, social, and economic domains. The analysis underscores the increasing global interest in green finance, as evidenced by the growing citation rates over time. Key findings include the pivotal role of green finance in energy efficiency, renewable energy development, and the promotion of sustainable economic growth. Overall, this research provides valuable insights for policymakers, researchers, and practitioners, emphasizing the importance of interdisciplinary collaboration and continued research efforts in advancing sustainable finance agendas.

Biodiversity loss and nature degradation are pressing issues with huge impacts on our society and economy. Businesses, investors, and regulators focus on corporate efforts to support biodiversity and nature positive actions. This review provides a comprehensive overview about the importance of biodiversity in businesses, the materiality of biodiversity and the role of mandatory and non-mandatory regulations on corporate environmental reporting and sustainability disclosure frameworks. The review also discusses descriptive information on the evolution of sustainability frameworks with a comparison of most prominent sustainability frameworks with a key focus on the materiality approach and biodiversity-related disclosure recommendations. Further, we provide suggestions for more holistic approaches to improve the future sustainability frameworks focusing on the biodiversity impact while showing the necessity of more focus on the decision-making paradigm. Further research on measuring biodiversity impact and innovative trends in sustainability reporting are required to better reflect nature-positive outcomes in corporate sector businesses.

The recent years have been marked by rapid growth in the field of "ESG finance," leading to the emergence and expansion of ESG ratings and rating agencies. This study seeks to examine how financial investors respond to updates in ESG ratings provided by two prominent ESG rating agencies: MSCI and Refinitiv. Specifically, the goal is to determine whether any potential positive or negative alterations in a company's sustainability ratings directly affect its market value. The chosen methodology for this investigation is the Event Study, a model employed to assess the influence of economic events on corporate valuations by analyzing their Cumulated Average Abnormal Returns (CAARs). Over 840 instances of rating updates (events) were analyzed using a sample of 75 companies across various industries, all listed on major stock exchanges. The findings indicate that shifts in sustainability ratings, as evaluated by the two rating agencies, do not have a significant impact on companies' market capitalization. Moreover, these outcomes remain consistent over time, suggesting that financial markets are not assigning increasing significance to ESG ratings. Potential explanations are offered and discussed in relation to existing literature on the subject.

Using the data of China's A-share non-financial listed enterprises from 2015 to 2022 as a sample, this study empirically tests the impact of ESG rating disagreement on corporate debt financing cost. The results show that ESG rating disagreement significantly increases the debt financing costs of enterprises, and this result still holds after a series of robustness tests such as replacing the dependent and independent variables and PSM approach. Meanwhile, the heterogeneity analysis reveals that non-state-owned enterprises and enterprises in non-heavily polluting industries are more sensitive to ESG ratings disagreement. In addition, mechanism analysis shows that corporate financing constraints mediate the relationship between ESG rating disagreements and debt financing costs. The findings of this study provide important evidence for understanding the impact of ESG rating disagreement on the costs of debt financing, enrich the meaning of ESG rating disagreement, and reveal the significance of unifying ESG rating standards.

Insurers act as institutional investors and underwriters of risk, therefore improving their own environmental, social, and governance (ESG) performance is important for the transmission of ESG values to all other economic sectors. We analyze ESG scores of worldwide Property and Casualty (P&C) insurers during 2012-2022, and show that more sustainable insurers have high operating leverage, although their combined ratios and z-scores reveal that they are financially stable. Additional results for the US subsample illustrate that stocks issued by sustainable insurers deliver positive excess returns. Overall, these findings suggest that sustainable practices are associated with the ability of insurers to execute business and create value. This is important for insurance managers, investors, and policy makers, as insurers play a prominent role in promoting economic growth and stability.

Environmental, social, and governance (ESG) investment has become a common trend in capital markets, and many institutional investors have publicly declared their long-term ESG investment target (ESGIT). This study focuses on investors who conduct strategic asset allocation (SAA) using composite indices but establish their ESGIT outside the SAA process. A mismatch could arise between investors’ planned and actual portfolios because they must pursue their ESGIT by asset selection, which inevitably makes the constituents of their portfolios different from those of composite indices. To scrutinize the potential existence of a misalignment between their SAA and ESGIT, this study analyzes actual stock and bond indices over the past decade using traditional mean-variance optimization. The results reveal significant differences between the expected and realized performances, and the misalignment is more significant when the analysis period is divided into two sub-periods: stable and volatile. Specifically, the results indicate that the efficient frontier constructed using ESG indices significantly differs from that constructed using composite indices, and that the difference between these two efficient frontiers becomes more significant during volatile periods. Furthermore, the results show that investors cannot meet their targets if their ESGIT is established outside the SAA process.

The study examines the return performance and resilience to market volatility of the recently introduced Environment, Social/Sustainable, and Governance (ESG) weight-tilted Hang Seng Index (HSIESG) compared to its parent, the Hang Seng Index (HSI). The ESG-infused index has a higher mean return and lower return volatility than the parent index, although the differences are statistically and economically insignificant, a result consistent with the high correlation between the two index returns. Most important, the ESG weighted-tilted index is more resilient to volatility spikes than the parent index and therefore has lower downside risks. The overall results show that stocks with high ESG ratings are less susceptible to trading pressures triggered by volatility-induced turnovers. The paper contributes to the literature by providing significant incremental information on the emerging market for ESG-related equity products in Hong Kong.

We examine the relation between environmental, social, and governance commitment levels (ESG) and firm dividend payer status. Given that larger and more profitable firms are positively associated with both payer status and ESG, it could be that ESG and dividends are complements. However, given that both dividends and ESG relate to firm spending decisions, it may be that the choice is “either/or” and that ESG and dividends are substitutes. We document a positive relation between ESG and dividend payer status in U.S. firms over the period 1991-2016. In particular we find that the proportion of dividend payers is roughly 13% higher for firms with positive ESG compared to those with negative ESG. Including ESG in the models used to predict payer status provides, on average, a nearly 26% improvement in relative forecast accuracy. Our results are robust to estimation techniques and the inclusion of variables known to be determinants of payer status.

The growing concerns on sustainability urge insurance companies to incorporate Environmental, Social, and Governance (ESG) policies in order to remain competitive. As all dimensions of sustainability involve taxation, it is important to establish if this association reflects on financial performance. Our analysis of worldwide property and casualty (P&C) insurers during 2013-2022 reveals that high ESG insurers pay more taxes, while are less profitable compared to low ESG insurers. This pattern is confirmed using instrumental variable regressions and simultaneous equations systems. We argue that sustainable insurers are less tempted to avoid taxes, and don't shift their tax burdens on policyholders and investors. However, the interplay between taxes and sustainability seems to harm insurers' profitability, potentially sorting negative consequences on investment and economic growth. This is an important insight for tax authorities and insurance managers.

This article affords the question of methane emissions in the context of the ESG framework at the global level. The World Bank ESG-Environmental, Social, and Governance database was used. The data refers to 193 countries for a period between 2011 and 2020. The econometric models used are Panel Data with Random Effects, Panel Data with Fixed Effects, Pooled Ordinary Least Squares-OLS, and Weighted Least Squares-WLS. The impact of methane on the ESG model was calculated through three equations capable of analyzing the impact of methane emissions, respectively, con-cerning the E-Environmental, S-Social, and G-Governance components of the ESG model. The re-sults show that methane emissions tend to increase even in the improvement of ESG conditions at world level.

The study explores the link between corporate social responsibility (CSR) and the financial performance of listed firms in the Philippines. This research used a longitudinal approach to investigate data from the Philippine Stock Exchange Index (PSEi) from 2019 to 2022. The environmental, social, and governance (ESG) framework assessed CSR performance, while financial performance was measured using return on equity and stock return. Firm profiles such as industry type, firm size, firm age, and auditor type were used as control variables. The researchers used firms' sustainability, annual, and governance reports as the primary data sources. The regression analysis results show insufficient data to support the idea that CSR performance affects the firm’s financial performance. It shows that only governance performance is positively correlated and significant with return on equity. Other components and overall CSR performance were found insignificant with return on equity and stock return. This study provides preliminary information on the link of CSR to the financial performance of listed firms in the Philippines. It extends the current literature on CSR performance and its link to financial performance in an emerging economy setting.

The present paper examines the impact of herding behavior on market capitalization in the Egyptian stock market before and after the disclosure of environmental-social-governance scores (ESG Score Index). This line of thought and research contributes to the literature on the interrelationships between ESG factors and market dynamics. Consequently, the evolving landscape of how to sustain investments in emerging markets like Egypt can be enlightened. Two main hypotheses were tested in the paper. The first hypothesis is on the expected significant impact of herding behaviour on market capitalization. The second hypothesis is on the expected positive impact of ESG on the relationship between herding behaviour and market capitalization. Panel data analysis using data extracted from financial statements of 22 Egyptian EGX 30 companies, over the period 2018-2023 will be used. This is to control for the cross-section and time characteristics of the research sample. The empirical findings reveal a positive significant effect of herding behavior on market capitalization before disclosing ESG scores. Another finding is that after the implementation of mandatory ESG disclosure, the relationship between herding behavior and market capitalization is strengthened. Moreover, it is empirically evident that companies with higher ESG performance attract more investments and higher valuations. The importance of ESG in shaping investment decision-making, enhancing transparency, and market dynamics has important policy implications.

This study analyzes the evolution of Corporate and Social Responsibility (CSR) and Environmental, Social, and Governance (ESG) concepts in social media, specifically on Twitter, from 2007 to 2022. The research aims to understand how society perceives organizational practices related to these aspects. Twitter provides an authentic environment for capturing user perceptions. The methodology involved collecting Tweets using Python and analyzing them in English, Spanish, and Portuguese with RStudio. The study's main findings highlight significant contributions and concerns within the CSR and ESG debates. While CSR's popularity showed a downward trend from 2010 to 2019, ESG grew exponentially during the pandemic and post-pandemic periods. Word analysis revealed the impact of specific hashtags: RSC in Spanish, #CSR in English, and #ESG in Portuguese. Society's increasing concerns concern environmental issues for combating global warming and ensuring a better quality of life, alongside financial transparency and ethical practices in companies. However, the social aspect of ESG, represented by the letter "S," didn't garner the same attention as environmental and governance matters. This discrepancy might stem from a lack of awareness or lower priority in public discussions on social media, overshadowing the social dimension in the ESG framework.

This paper examines the relationship between the ratio of independent board member to the financial performance of the company under the mediation of the three pillars of environment, society, and governance (ESG) in Taiwan. The study addresses a research gap between independent directors and corporate financial performance, an issue that is rarely discussed today. The author develops the hypotheses and tests them by applying panel data regression to the data tables taken from the Thomson Reuters Eikon database to analyze data on 173 Taiwanese companies that reported ESG from 2009 to 2021. The results show that the relationship between the ratio of independent directors and financial performance has a positive relationship. At the same time, the 3 pillars of ESG also clearly show the intermediary role in this relationship. Finally, this study provides additional insights into the relationship between the ratio of independent directors and financial performance in the Taiwan context.

The research analysed the publications metric of literature regarding the impact of socially responsible investing (SRI) and environmental, social, and governance (ESG) on portfolio and financial performance. The study aimed to determine the latest trends, key themes, authors, and influential journals. Data from the SCOPUS database was used in this study. A total of 1377 research articles from academic journals related to this topic and published from 2013 to 2022, they data was cleaned to remove duplicate, and documents that do not meet the criteria of this study. For this bibliometric analysis, a total of 260 articles were chosen in order to summarise the collective knowledge and emerging patterns in ESG, SRI, ethical, and impact investing, a bibliometric analysis was employed. The thematic map classified the ESG, SRI, and performance relationship themes into four categories of themes: niche themes, motor themes (corporate financial performance, corporate social performance, ESG, ESG factors, sustainability, performance, integrated reporting, gender diversity, and board size), emerging or declining themes (social responsibility, environmental performance, socially responsible investment, ethical investment, and SRI), and basic or transversal themes (financial performance, corporate social performance, ESG performance, environmental, social, and governance). Social responsible investing, engagement, and ESG, implies a position between niche themes and highly developed topic/emerging or decreasing theme, and covid, ROA, while, tobin’s Q, implies a position between highly developed topic/emerging or decreasing theme and basic theme. The findings contribute to the enhanced understanding of ESG, SRI, ethical, and impact investing, which are crucial for an efficient capital market in promoting sustainability and sustainable development. The study offers vital practical implications and future research directions.

This work aims to initiate a reflection on the awareness of environmental, social, and corporate governance issues, summarized in the acronym ESG (Environmental, Social, Governance), among Italian SMEs. The integration of ESG issues into business models has led to an expansion of the risk taxonomy affecting corporate management. In addition to traditional financial risks, new risks have emerged, primarily climate risk, environmental, and energy risks, which can significantly impact companies' ability to create economic value. This includes planning and designing virtuous initiatives focused on sustainability and the ability to build public-private partnerships with various stakeholders. After this theoretical framework aimed at highlighting the evolution of the concept of corporate sustainability following the introduction of ESG factors, a clustering of non-performing loans of Italian companies is proposed using a k-Means algorithm, comparing the results obtained through two different methods, namely the Elbow method and the Silhouette coefficient. Finally, using data on Italian regions between 2004 and 2023, an empirical analysis is conducted to provide an estimate of the relationship between non-performing loans and some variables related to ESG components.

This paper explores the emergence of Sustainability-Linked Bonds (SLBs) as an innovative instrument to finance sustainability objectives. SLBs have emerged as a transformative financial instrument, establishing an explicit link between cost of funding and sustainability objectives. SLBs were first launched in 2019 and represent 7% of labelled bonds, still dominated by the more established green bonds. Issuance of SLBs now exceeds $250 billion. Following initial enthusiasm, they are now facing criticism. In the context of the growth of sustainable finance and concerns of greenwashing, this paper investigates ways to enhance the design of SLBs. Drawing on literature and expert interviews, the findings highlight the strong potential of SLBs to contribute to sustainability financing, especially in hard-to-abate sectors. The paper identifies the key positive attributes of SLBs and their limitations in five areas: key performance indicators’ (KPI) selection, sustainability performance targets’ (SPT) calibration, bond characteristics, reporting practices, and resource requirements. Recommendations to financial intermediaries, issuers and policy makers include defining standardized KPIs based on a materiality assessment, requesting SPTs to be supported by science and in line with an issuer’s core strategy, tailored step-up mechanisms and avoidance of call loopholes, and stricter reporting. SLBs represent an opportunity to add rigor to sustainable finance and better price externalities, where material topics have an explicit impact on cost of funding and credit ratings.

Purpose –This study examines the effect of ESG performance on auditor choice and audit opinion for Egyptian-listed firms. Design/methodology/approach – We use univariate and multivariate analyses of 612 firm-year observations for a sample of 68 firms listed on EGX100 over 2012-2022 using binary logistic regression models. Findings – Consistent with the ethical perspective of corporate social responsibility, we found that firms listed in the ESG index are more likely to assign one of the Big4 auditors, and less likely to receive a qualified opinion. In addition, we find that COVID-19 moderates the relationship between ESG performance, auditor choice, and audit opinion. Originality/value – Our results contribute to the growing interest in the implications of ESG performance for audit practices in emerging economies. Implications: This research has important implications for investors, the audit profession, firms, and regulators in Egypt. It provides substantial evidence that ESG performance can enhance financial reporting quality. Further, it indicates that binding guidelines and regulations are crucial to oversee corporate ESG performance, especially during crisis time to enhance investors’ protection and firms’ sustainability.

Recently, the introduction of Environmental, Social, and Governance (ESG) scores has become crucial for investment decisions and in minimizing portfolio risk. This study aims to understand the relationship between ESG scores and Value-at-Risk (VaR), computed by using a Vine copula-GARCH based approach, chosen for its reliability in detecting interdependencies among multiple stocks. In fact, one of the main challenges in estimating VaR for a stock portfolio is capturing the dependence structure among a large number of assets. The dataset consists of 16 companies listed on the FTSE100 index. The corresponding ESG scores were collected over a comprehensive period of five years, from 2018 to 2022, covering both normal and stressed market conditions. Additionally, a focused analysis was conducted for the period from 2020 to 2022 to isolate the specific effects of the COVID crisis. The results indicate that an increase in assets with the highest ESG scores reduces potential losses in the portfolio. This finding underscores the importance of integrating high-level ESG scores into portfolios to mitigate market risk. Additionally, during periods characterized by stressed market conditions, the impact of ESG scores on VaR is even more pronounced, demonstrating that sustainable assets are more resilient in times of crisis.

With growing global emphasis on sustainable development and social responsibility, Environmental, Social, and Governance (ESG) ratings have emerged as critical metrics to evaluate commercial banks’ operating performance. The paper utilizes panel data spanning 2009 to 2022 from large state-owned and joint-stock commercial banks in China. It employs a two-way fixed effect model and robustness tests, alongside tests for heterogeneity analysis and moderating effect to conduct empirical analysis. The findings of the fixed effect model indicate that improvements in ESG performance have advantageous impacts on commercial banks’ operating performance, particularly with higher growth rate for operating income Robustness tests including mixed regressions, Tobit tests, variable substitutions, and tests of endogenous bias have validated that initial regression findings still hold. Tests of heterogeneity analysis reveal that among large state-owned commercial banks, banks with higher leverage, larger major shareholder ownership, and larger banks scales, ESG performance can significantly affect the banks’ operating performance, and the relationship exhibits positive. Furthermore, the paper finds that GDP growth rate, CPI and analysts’ coverage can strengthen the relationship between ESG performance and commercial banks’ operating performance through moderating effects. The research provides policy proposals and strategic recommendations tailored for policymakers, banks, and investors, building on these insights.

Discussions and practices on sustainability are actively underway around the world. In this social context, this study conceptualized ESG management values ​​focused on sports organizations, especially professional sports clubs in Korea. Utilizing Q Methodology, suitable for research on individual's subjectivity, we explored ESG management values accepted by consumers of Korean professional sports. As a result, the ESG management values were confirmed as follows: ‘Type I: Trust-Management Emphasis,’ ‘Type II: Local-Community Emphasis,’ and ‘Type III: Safety-Respect Culture Emphasis.’ While each of the three types accepted governance, social responsibility, safety, and respect culture as their main values, they tended to deny environment-related values. Accordingly, this study provided two discussions: ‘Professional sports consumers’ low awareness of the environment’ and ‘Reinterpretation of environmental values ​​among the ESG management values ​​of professional sports clubs’. In conclusion, the three types are significant in that (1) they well reflect the social and cultural context of Korean professional sports and consumers' perceptions, and (2) they provide a new perspective on the ESG management value of professional sports teams.

The following article analyses the relationship between the mental health index and the variables of the Environment, Social and Governance-ESG model in the Italian regions between 2004 and 2023. First of all, a static analysis is proposed aimed at identifying trends relating to mental health in the Italian regions with indication of the regional gaps. Subsequently, a clustering with k-Means algorithm is proposed. Below is a comparison of 11 machine learning algorithms for predicting the performance of the mental health index. Finally, the article offers some economic policy suggestions. The results are critically discussed in light of the scientific literature.

The following article analyses the relationship between the mental health index and the variables of the Environment, Social and Governance-ESG model in the Italian regions between 2004 and 2023. The econometric analysis is aimed at investigating in detail the relationships between the mental health index and the individual components of the ESG model. The results are critically discussed

In recent years, with the increasing prominence of environmental and social issues, investors have been paying more attention to the ESG performance of enterprises, highlighting the importance of ESG factors in the financial field. This study is based on the theories of banking business models, stakeholder theory, risk management theory, and ESG investment theory. It uses the financial data and ESG scores of Chinese listed banks to deeply analyze the ESG factors and explore their impact on the liquidity risk of commercial banks. The research found that (1) good ESG performance can reduce the liquidity risk commercial banks face by improving bank value and financial performance. (2) ESG factors can also enhance the liquidity management level of commercial banks through standardization and sustainable business principles, thereby reducing the occurrence and impact of liquidity risk. Therefore, it is necessary to reduce the liquidity risk of banks and promote the sustainable development of commercial banks from four aspects: ESG performance and management, bank value, financial performance, and policy regulation.

In the empirical dimension, the authors' intention was to define the criteria that should be taken into account by universities to meet the requirements of sustainable university development - in terms of activities and reporting through the analysis of good practices developed by top Polish universities. The aim was also to select activities that, based on benchmarks, could be used by universities at every stage of implementing SDG goals. This is not an easy task, considering that for educational institutions the priority is the educational process, and the implementation of the principles of sustainable development is only possible through an intensive educational process combined with the application of knowledge in practice. This is a challenge for the university because it requires remodeling the current culture, changes in processes and the perception of certain cultural and social phenomena, and will involve a change in the teacher-student relationship, a change in the traditional education process to practice-based education, and will also require an interdisciplinary context. in the content provided. But this is precisely the challenge for outstanding educators. The authors compared three significant world rankings to which Polish universities also report. They collected information and data mainly regarding the activities undertaken by the reporting Polish universities in the area of ​​developing good practices. Many ideas and tips will enable the preparation of further material, which the authors plan to deepen with a detailed analysis of SD indicators.

Under the new pattern of “double carbon” development, good ESG performance is the best way to promote the sustainable development of enterprises, and the ESG investment strategies are directly affected by the strategic vision of managers. Based on the upper echelons theory and stakeholder theory, this paper takes Chinese A-share listed companies from 2011 to 2022 as samples to empirically analyze the impact of managerial myopia on corporate ESG performance. The results show that managerial myopia significantly inhibits corporate ESG performance, mainly by inhibiting corporate green investment and green innovation sustainability. Furthermore, for state-owned enterprises (SOE), heavy polluting enterprises (HPE) and non-high-tech enterprises, the inhibitory effect of manager myopia on ESG performance is stronger. When the enterprise is in the growth stage, the above inhibition effect is more severe. For external governance, the greater the analyst attention and public environmental attention are, the more conducive they are to alleviating the restraining effect of managerial myopia on enterprise ESG performance. Therefore, effectively improving the time cognition level of managers and strengthening external supervision have become important measures for comprehensively optimizing the ESG performance.

ESG (Environmental, Social, and Governance) responsibility fulfillment increasingly affects enterprise valuation. Although researchers debate about the precise effects, the prevailing view suggests a linear relationship between ESG performance and enterprise value. This study introduces a novel ESG responsibility performance metric through the Regulated Intermediary Model to delve into this relationship within the Chinese context. Our findings reveal an inverted U-shaped relationship between ESG performance and enterprise value, with financing constraints having a significant moderating effect. These findings remain robust after employing instrumental variables to mitigate potential endogeneity. Heterogeneity analysis demonstrates that this inverted U-shaped relationship is particularly pronounced in non-polluting and non-state-owned enterprises. Moreover, a comparison between equity and debt financing mechanisms underscores that improved ESG performance is associated with lower cost of equity financing, thereby enhancing enterprise value. Financial institutions are encouraged to leverage innovative financial instruments to diversify enterprise financing channels and alleviate financing constraints of enterprises that fulfill their ESG responsibilities.

Reducing atmospheric emissions through the introduction of circular economy principles is one of the current tasks of sustainable regional development. The research purpose is to study the impact of the actions taken by Karachaganak Petroleum Operating B.V. (KPO) in order to reduce air pollution, and basing on it, to evaluate the forming potential of the circulating economy in one of the biggest regions of Kazakhstan in which KPO is operating. Oil and gas production activities of the company is related to air pollution of the region. The study was conducted using methods of econometric modeling, statistical and comparative analyses. The study’s value is determined by its interdisciplinary approach, which made it possible to combine environmental and economic criteria for sustainable regional development with the features of emissions and waste management technologies in industry. Studying the work experience and analyzing the impact of KPO on the development of the region in the period 2012-2022 made it possible to construct a matrix of the restorative potential of the circular economy of the region. A model for the formation of a circular economy is proposed, which is based on the introduction of innovations, investments in environmental protection, the use of the best available technologies for reinjecting gas into the reservoir, increasing energy efficiency, recycling of waste, which made it possible to significantly (2.2 times) reduce the amount of air pollution in region. According to the forecast model (2024-2028), it was determined that in case of maintaining independent indicators’ certain dynamic of development, the level of atmospheric emissions by KPO could be reduced by 2 times. The results of the scientific work contain statements proving that further researches on the problems of reducing atmospheric pollution within the framework of the formation of a circular economy are quite perspective and promising. The results of the study might be interesting and used when implementing measures to manage air quality in the region by managers, heads of organizations, state and local authorities, and researchers interested in promoting the ESG concept of sustainable development.

Driven by global sustainability trends, Building Information Modelling (BIM) technology is in-creasingly becoming a key tool in the construction industry to improve efficiency and sustaina-bility.This study aims to identify the key factors affecting BIM implementation in the context of Environmental, Social and Governance (ESG) and Sustainable Development Goals (SDGs) and to construct a theoretical framework for BIM implementation based on these factors.To achieve this objective, this study used a systematic literature review (SLR) method to systematically review the relevant literature between 2009 and 2024, and identified 16 key factors from the selected 406 studies through keyword co-occurrence analysis (using VOSviewer) and data coding.These key factors include:Top Management Support for ESG and SDGs,Alignment of SDGs,ESG Integra-tion,Technical Support,BIM Software,BIM Hardware,Structural Adjustment & Collabora-tion,Capacity Building,Change Management,Skill and Attitude,Educational Training and Devel-opment,Incentive Mechanism,Roles & Responsibilities,Sustainable Construction Practic-es,Policies and Regulations,Resource Efficiency.This study categorises these factors under the STOPE framework (Strategy, Technology, Organisation, People, Environment) and proposes a theoretical implementation framework for BIM accordingly. The findings not only provide a practical guiding framework for the sustainable development of construction companies in the context of ESG and SDG integration, but also lay a solid theoretical foundation for future empiri-cal research.

Matters relating to preservation of environmental resources and climate change, social inclusion and diversity, and open and sound governance have rapidly gained global attention. However, little is known about the construction industry in meeting the environmental, social and governance (ESG) criteria towards sustainable development. In this study, the purpose is to identify the key ESG indicators for construction development. A systematic literature review was undertaken using data from Scopus, PubMed, Google Scholar, JSTOR, ProQuest, and Web of Science. The results show some of the key ESG indicators as climate resilience and green construction activities (at the project level), and active stakeholder engagement and effective project governance (at the firm level) and meeting environmental and social regulation requirements (industry/national level). The limitation of the article is in the sample size of twenty-six journal articles with future expectation of increment as ESG gain more acceptance in the construction industry. This study will be significant for the design of practice framework and policies on ESG in the construction industry. Comprehensively, this study presents relevant ESG indicators for construction management and presents essential information for future research.

Banks have enormous potential in supporting the achievement of sustainable development goals (SDGs) in accordance with their function as financial intermediaries through sustainable lending. However, the average national financing growth for the sustainable business activity category over the past four years is still 12%. The aim of this research is to identify the conditions of sustainable lending at state-owned conventional banks and analyze the influence of the value chain, economic performance and ESG performance on sustainable lending. The research was conducted at state-owned commercial banks in Indonesia. The research utilized a Structural Equation Modeling (SEM). The SEM results of this study describe value chain, ESG performance (environmental, social and governance) and economic performance have direct and positive influences on sustainable lending, of which ESG performance has the biggest influence. As per individual aspect, social orientation gives the biggest contribution toward sustainable lending.

Increasingly, firms are expected to implement ESG (Environment, Social, and Governance) mandates to appeal to the global market. However, this requires overcoming practical challenges and capitalizing on emerging opportunities. This paper conducts an in-depth analysis of the ESG practices of leading Korean global firms. The study selects five firms for case studies representing industries such as electronics, automotive, steelmaking, and chemicals. It examines ESG reports, performance indicators, and corporate disclosures of these firms. The analysis reveals the adoption of industry-specific ESG strategies, highlighting how these firms tailor their approaches to address unique industry challenges while aligning with global sustainability trends. Key findings include a strong emphasis on innovative solutions to ESG challenges, the integration of ESG into core business operations, and a balanced approach to economic, social, and environmental responsibilities. This study contributes to a broader understanding of how ESG practices are implemented in various industrial contexts, particularly in the dynamic and evolving landscape of Korean global businesses. It offers valuable insights and benchmarks for global companies, underlining the importance of contextualized and industry-specific ESG strategies in achieving sustainable and ethical business practices

This study examines the unique circumstances surrounding state-owned equity participation in non-state-controlled enterprises in China. Specifically, this study examines the impact of state-owned equity participation on the environmental, social, and governance (ESG) performance of non-state-controlled enterprises. Focusing on A-share listed firms on the Shanghai and Shenzhen Stock Exchanges and using data from 2013 to 2021, empirical testing shows that state-owned equity participation can significantly improve the ESG performance of non-state-controlled enterprises, with this conclusion remaining reliable after a series of robustness tests. Top management incentives is a mediating mechanism for state-owned equity participation in enhancing ESG performance. This study also finds that when state-owned equity participates in large enterprises or companies with a high degree of digital transformation, the effect on ESG performance is greater than that of small to medium-sized enterprises (SMEs) or enterprises with a low level of digital transformation. The findings of this study add to the current body of the existing field of research on the factors influencing corporate ESG performance and the impact of state-owned equity on corporate non-financial performance.

Analytical study presents the evolution and change in content over time and the emergence of different sustainable tourism (ST) concepts in tourism and hospitality. For this purpose, a Comparative Automated Content Analysis (ACA) analyses scientific articles published between 1990, when the first article in this field was published in the Web of Science (WOS), and the end of 2020. With the ACA for analysis papers research, this research helps explain why and how changing business models cross the time, organizational processes, importance of information and communication technologies in sustainable tourism strategies, green investments, sustainable standards in tourism and hospitality, and sustainable reporting.

This paper explores the critical role of the banking sector in facilitating the ecological transition through the integration of ESG (Environmental, Social, and Governance) factors. By analyzing the intersection of ESG considerations and access to credit globally, the study highlights how banks can catalyze sustainable investments while balancing financial risks. Using a systematic literature review and k-Means clustering analysis, we assess the global landscape of credit access, emphasizing the implications of ESG adoption on financial stability and economic growth. The findings suggest that while ESG integration presents challenges, it offers significant opportunities for banks to enhance their competitiveness and foster resilient financial systems. The paper concludes by proposing policy recommendations aimed at improving the incorporation of ESG factors within credit risk management and promoting sustainable finance.

Student-centered active learning (SCAL) shifts the focus from the teacher to the student. Implementing SCAL requires the development of new forms of assessment beyond memorization and comprehension. This paper aims to demonstrate the effectiveness of SCAL by analyzing student performance at different cognitive levels. In flipped classrooms, students completed tasks with varying cognitive demands. The tests measured knowledge (level 1), comprehension (level 2), application (level 3) and analysis (level 4). This approach to assessment assesses not only the acquisition of content, but also skills that are critical to a health science student's future career. The results of expository learning were compared with student-centered collaborative learning in the Anatomy and Embryology I course over three academic years. Student opinions were collected through 326 anonymous Wooclap® surveys. No differences in performance were found for low cognitive level questions. However, SCAL significantly improved performance on higher cognitive level questions that required problem solving and application of knowledge. Despite the benefits of SCAL, it requires more effort from both teachers and students. The current assessment system, which measures the quality of teaching, penalizes this effort and requires teachers to believe strongly in the effectiveness of SCAL.

We aim to map the ESG patterns of emerging-market companies from 2018 to 2021 in order to determine whether the COVID-19 pandemic exerted any influence on sustainable corporate behavior. Thus, the ESG performances were assessed by applying the Kohonen neural network for clustering purposes at three main levels: i) ESG overall, including country and sectoral perspectives; ii) ESG thematic; and iii) ESG four-folded (stakeholder, perspective, management level, and focus strategic views). Our results show that emerging-market companies focus their ESG efforts on social and governance issues rather than on environmental. However, environmental, and social behavior differ more acutely than governance behavior across clusters. The ESG pillars country-level and eleven market-based economic sectors analysis corroborate the geographic and sector dependence of ESG performance. The thematic-level analysis indicate that operational activities and community issues received more attention, which suggests that emerging-market companies address distinct ESG topics according to their particularities and competitiveness. Furthermore, our empirical findings provide evidence that the ESG behavior of companies has changed over the course of the COVID-19 pandemic. Thus, our findings are relevant to policymakers involved in regulating ESG disclosure practices, investors focused on enhancing their sustainable investment strategies, and firms engaged in improving their ESG involvement.

With the increased global attention to environmental protection, social responsibility and corporate governance (ESG) standards, integrating ESG into supply chain management (SCM) is becoming a strategic requirement for companies to achieve competitiveness and sustainable development. This study reviews the impact factors of ESG practices on supply chain competitiveness, and empirically examines the mechanism of ESG performance on supply chains through a questionnaire survey with a sample of Chinese SMEs. It was found that normative pressure, coercive pressure and imitative pressure in SMEs have a significant positive effect on cognition and attitude and perceived behavioral control; good corporate cognition and attitude, perceived behavioral control and corporate pressure also enhance the level of ESG practices. Further analysis shows that cognition and attitude and perceived behavioral control play a mediating role in the impact of ESG practices, and ESG performance promotes sustainable development of SMEs. The article puts forward the following suggestions: (1) close supply chain partnerships to enhance green innovation; (2) the government should give more resource support to ESG-invested enterprises and support the development of advantageous enterprises; (3) improve the corporate disclosure mechanism and strengthen the supervision; and (4) strengthen the training of professionals in supply chain ESG management.

For several years, commercial banks in Poland have been reporting activities related to the impact on the environment, society, and corporate governance (ESG). However, only new guidelines, mandatory for many entities, including banks, will allow for comparing these reports, which will be of great importance mainly for investors. The forms of these reports were and still are different, difficult to compare in individual years, and difficult to compare between banks. The article aims to present the banks' preparation for the new reporting rules based on the latest ESG reports. The research was conducted in 4 groups of commercial banks operating in Poland, which are the largest companies listed in the WIG Banks sub-index of the Warsaw Stock Exchange. Gaps in the preparation of these banks for non-financial reporting were identified. The non-financial reports of the banks studied have significant information potential that can be used by various stakeholder groups, including investors, customers, employees, regulators, and local communities. However, the comparability of ESG reports is one of the key challenges faced by both reporting banks and users of these reports. The research results can be used both in scientific works and by bank representatives to improve non-financial reports.

This article conceptualises the link between firms’ value chains and distribution networks and the requirements for double materiality assessments in contemporary reporting regulations worldwide. The new European Sustainability Reporting Standards (ESRS) and the standards for sustainability reporting issued by the International Sustainability Standards Board (ISSB), called IFRS S1 and IFRS S2, require companies to report their own direct (scope 1) and indirect (scope 2) greenhouse gas (GHG) emissions as well as GHG emissions in their value chains and distribution networks (both scope 3). However, GHG emissions comprise just one dimension of information that is relevant to understand when assessing, managing and reporting the footprints and impacts of a firm and are, therefore, only a fraction of the key performance indicators (KPIs) related to ESG that should be disclosed. Through a case study, this article demonstrates the connection between the due diligence analysis of firms’ value chains and distribution networks, the analysis of the competitive parameters of the business model, the identified impacts, risks and opportunities, and the double materiality perspective. The double materiality perspective prioritises actions based on probability and significance, creating a natural space to identify KPIs. The article concludes by applying the REGS model and illustrating how it can assist firms in identifying relevant KPIs based on double-materiality assessments.

This study analyzes the influence of CEO types on corporate governance, focusing on de facto (substantial) CEOs. We examine how substantial CEOs impact ESG activities (Hypothesis 1) and corporate value (Hypothesis 2). Data were collected from KIS-VALUE and DART (Electronic Disclosure System) of the Financial Supervisory Service, defining substantial CEOs as highest remuneration recipients exceeding the representative director of the company pay. Results sup-port Hypothesis 1, showing companies with substantial CEOs are more engaged in ESG activities, potentially to improve public image while concealing self-serving behaviors. Hypothesis 2 is validated, indicating lower corporate value in companies with substantial CEOs due to prioritizing personal interests over long-term profit maximization. Despite limitations in exploring governance relationships beyond remuneration data, the study offers key contributions. It expands research on corporate governance and ESG activities by identifying substantial CEOs through objective remuneration data. It highlights the importance of an independent board for transparent governance and positive corporate value. Lastly, empirical evidence shows the negative impact of misdirected ESG activities on corporate value. By using remuneration as an indicator, this study illuminates substantial CEOs' influence on corporate value and ESG activities, providing insights for future research in corporate governance and ESG.

Digital transformation provides new drivers for economic performance growth in enterprises, but can it further improve ESG performance and support sustainable development? Based on the perspective of resources and capabilities, this paper uses the relevant data of 1588 listed companies in strategic emerging industries from 2011 to 2021 to study the differential impact of digital transformation on enterprise ESG performance, and further tests the mediating role of absorptive capacity and the moderating role of regional digital level. The research results indicate that: firstly, digital transformation of enterprises can positively promote the improvement of ESG performance; Secondly, there are significant differences in the impact of digital transformation on the ESG performance of enterprises in terms of property rights and industry characteristics. The ESG performance of state-owned enterprises and high-end equipment manufacturing enterprises is more sensitive to digital transformation; Thirdly, absorptive capacity plays a mediating role between digital transformation and corporate ESG performance; Fourthly, the positive regulation of regional digital level promotes the ESG performance of enterprises through digital transformation. The research conclusion is based on a digital perspective, providing relevant insights for improving the ESG performance of strategic emerging industry enterprises and expanding their ESG development paths.

This study delves into the critical domain of public procurement, specifically focusing on Sustainable Public Procurement (SPP) and Environmental, Social, and Governance (ESG) considerations within the context of South Korea. The aim of this research is to empirically scrutinize the factors influencing the impact index of SPP, with a particular emphasis on services related to labor standards. The investigation spans three years, from January 1, 2019, to July 31, 2021, encompassing state agency orders and post-implementation legal changes. Leveraging the comprehensive Korea On-line E-Procurement Sys-tem(KONEPS) platform, we meticulously collected data, ultimately culminating in 21,573 services meeting our criteria, from which 250 cases underwent an in-depth analysis. The study sheds light on the influence of social responsibility evaluation cri-teria on overall procurement scores, while also uncovering the moderating effects of various factors. The outcomes of this study offer valuable insights into the impact index of social responsibility evaluation criteria within South Korea's public procurement landscape. Factors including procurement year, classification, service period, and estimated price were identified as significant influencers. Moreover, the number and location of evalu-ation criteria items, inclusion of sincerity elements, and the evaluating agency were deemed pivotal determinants of the influence index. These findings hold profound implications for policymakers, procurement practitioners, and researchers and provide a roadmap for optimizing the utilization of social responsibility evaluation criteria to advance responsible and sustainable procurement practices. Future research avenues include conducting further study of additional moderat-ing variables, expanding datasets to encompass a broader spectrum of procurement contexts, and evaluating the long-term repercussions of social responsibility evaluation on procurement outcomes. These endeavors promise to further refine and advance public procurement practices in South Korea and beyond.

This study investigated the relationship between environmental, social, and governance (ESG) disclosure and the performance of Saudi Arabian companies. We analysed panel data from the 100 non-financial companies listed on the Saudi stock exchange (Tadawul) from 2017 to 2022. Using fixed effects, random effects, and generalised method of moments (GMM) models to account for endogeneity concerns, we examined the impact of ESG disclosure on the return on assets (ROA), return on equity (ROE), and Tobin’s Q. An ESG index was constructed through principal component analysis of individual environmental, social, and governance scores. Our results indicate a significant positive relationship between ESG disclosure and companies’ key performance variables across all models. These findings are consistent with stakeholder theory and signalling theory, suggesting that comprehensive ESG practices can lead to better financial performance and serve as a positive signal to stakeholders. The study also reveals sector-specific differences, with non-manufacturing firms showing stronger positive relationships between ESG disclosure and performance measures compared to manufacturing firms. Additionally, we find that firm size, age, and liquidity are important factors influencing the ESG–performance relationship. This research contributes to the growing literature on ESG and corporate performance in emerging markets, offering valuable insights for policymakers, investors, and corporate practitioners in Saudi Arabia’s evolving sustainable business landscape. Our findings underscore the importance of ESG disclosure in driving sustainable and responsible business practices in the region.

In recent years, ESG (environmental, social, governance) has emerged as a critical investment concept. Its goal is to create value for both shareholders and society, encouraging companies to optimize social value. However, the exploration and research into "the proportion of firms ex-porting and the pathways through which the environmental, social, and governance activities of carbon-intensive firms influence firms' financial performance" remains largely unexplored. This study establishes a research framework within this context, utilizing listed Chinese manufactur-ing companies as the research subjects. Employing a fixed-time, fixed-industry, two-way fixed-effects model methodology, it delves into the relationship between ESG ratings, the pro-portion of firms' exports, and firms' financial performance through panel regression modeling. This study emphasizes the moderating role of carbon-intensive firms in the relationship. Find-ings indicate that both enterprise export proportions and carbon-intensive firms significantly affect the correlation between corporate ESG activities and financial performance. This has im-plications for investors, company management, policymakers, and regulators. Based on these findings, we propose policy recommendations at corporate and governmental levels to enhance ESG significance, strengthen corporate governance, and promote continuous ESG advancement. The study provides micro-level evidence of the interaction among ESG ratings, export ratios, carbon-intensive enterprises, and corporate performance, empowering investors to make in-formed decisions.

The present study investigates the decision-making process of investors on the Pakistan Stock Exchange with regard to portfolio construction, explicitly focusing on the incorporation of ESG concerns. The present study employed SmartPLS and structural equation modeling (SEM) to quantitatively assess data received from a sample of 393 out of 400 respondents. Based on the available data, investors participating in the Pakistan Stock Exchange are notably impacted by ESG aspects. The findings of this study hold significance for emerging economy firms, regulators, and investors, both in terms of theoretical and practical ramifications. The study's findings demonstrate a clear indication of investors' significant emphasis on ESG matters. Furthermore, it provides valuable insights for stakeholders who are involved in the ever-evolving realm of sustainable finance within developing countries

This study examines the integration of Environmental, Social, and Governance (ESG) factors into global banking practices and their impact on financial stability, measured by the Bank to Capital Asset Ratio. Through a comprehensive literature review and data analysis, the paper highlights the dual role of banks as catalysts for ESG investment and risk managers. It discusses the challenges and opportunities in transitioning to ESG-aligned business models, emphasizing the importance of regulatory frameworks and risk management approaches. The findings suggest that ESG integration enhances bank stability and competitiveness, contributing to sustainable economic development. The paper concludes with policy implications and recommendations for further integration of ESG factors into banking governance.

In this age of global warming, academics and policymakers are increasingly concerned about firm environmental sustainability success. Therefore, this study aims to investigate whether Environmental, Social and Governance (ESG) performance impacts sustainability performance through the mediating effect of firm innovation. To this end, Structural Equation Modeling (SEM) was deployed to analyze data collected from the employees of manufacturing industries in an emerging economy like Bangladesh. The results revealed that ESG performance significantly enhances the innovation and sustainability performance of manufacturing industries, indicating that the higher the ESG performance of a firm, the greater its innovation and sustainability performance. Furthermore, the results confirmed that firm innovation performance fully mediates the relationship between ESG initiatives and sustainability performance. The findings of this study provide policymakers and industry authorities with valuable insight into the role of ESG and innovation performance in improving sustainability performance. Specifically, the study sheds knowledge on how firm ESG initiatives and innovation performance impact sustainability performance in the manufacturing sector of an emerging economy like Bangladesh.

Investors are currently obliged to take ESG (Environment, Social, Governance) issues into consideration as part of their fiduciary duty. As such, it becomes increasingly important to identify sustainable investments that hold financial value as well. A sector where this is especially underdeveloped is real estate. This has a lot to do with the obfuscated conceptualization of ESG. The article identifies key gaps in literature and practice, and provides a framework to further the understanding of how ESG factors can add societal and financial value in the real estate sector. A key premise of the article is that the user in the building is grossly overlooked. Drawing on insights from behavioral social science and environmental psychology, the paper explains the role of the user in improving buildings’ ESG, also taking into account the investment value. To conclude, the article makes the case that the transition to user-centered smart real estate is the solution to improving both the environmental (E) and social (S) sustainability of buildings, as well as their investment value. Therefore, practitioners and academics are encouraged to critically evaluate and contextualize the ESG framework they are using, as well as the extent to which users are considered and smart technology is employed.

The central aim of this paper is to present the Green Web Meter software which is designed to support the measurement of digital sustainability performance of websites and web apps, as well as providing sound based analytic tools for improving their overall quality. We analyzed scientific literature and specifically selected three quality assessment models (E-S Qual, Sitequal, Webqual 4.0) which we used as a starting point for identifying the most crucial aspects for the monitoring activities. A consistent set of Key Performance Indicators (KPIs) suitable for automated tracking has been provided. We finally developed model-based software able to deliver solutions for real-time website performance analysis and reports. We structured the model to offer accurate references for digital sustainability reporting by aggregating the KPIs into an Environmental, Social, and Governance (ESG) framework and computing a comprehensive score for its pillars.

In the sustainable economy, consumer preferences are gradually coming to prioritise environmentally friendly products and services. A sustainable economy is directly linked to the growth of consumer welfare and environmental culture. The success of environmental projects is largely determined by approaches to the management of complex interconnected objects. Technological integration and the value chain from raw material extraction to the marketing of environmentally friendly products add to the growth factors. In this regard, we formulate the purpose of this study: to generalise the approaches and improve the mechanism of the ecological branding of the industrial complex of a region through conscious ESG transformation. For this purpose, we studied statistics and principles of management systems of Kazakh companies and their stakeholders. We analysed the situation of industrial complexes and their partners in the external environment to identify barriers to the development and implementation of eco-branding tools. The theoretical significance of the study helps to reveal the influence of ecological principles of modern production organisation on the speed of transition to green technologies. Its practical significance is seen in the formation of a system for measuring the level of readiness of companies to promote the ecological branding of a region’s industry outside its country.

The small business sector in Kazakhstan demonstrates dynamic growth, but its sustainable development in modern conditions requires activation from government agencies, society and entrepreneurs themselves The purpose of the article is to study the development of small entrepreneurship in Kazakhstan and develop a mechanism for sustainable development based on network interaction "business entities - society-state" with the identification of priority areas of development based on a rating approach. The methods of bibliographic analysis of scientific literature, statistical, correlation analysis, survey, comparative analysis, ranking based on data normalization were used. The results revealed the need to formalize indicators of sustainable development of the small business sector in strategic development programs; create conditions, support, explain the importance and prospects of investing in sustainable innovations by small businesses; form a balanced strategy for achieving carbon neutrality based on network interaction "business entities - society-state" with the identification of priority areas of development based on a rating approach to ensure transparency and publicity of decisions made. Conclusions are made about the need to popularize sustainable development among business entities, stimulate investment activity through government participation, legislative regulation of public presentation of non-financial reporting, and assist society in the formation of an ESG culture.

The article investigates the impact of the Environmental, Social, and Governance (ESG) criteria on the current tax systems worldwide. The ESG principles, although yet to be codified in hard law in most countries, are gaining increasing prominence in shaping business practices and policies. The article explores how these principles might influence the interpretation and application of existing tax rules, even without explicit legal mandates. It delves into four key areas where ESG considerations could play a significant role: the calculation of business income, transfer pricing regulations, the application of anti-avoidance rules, and the interpretation of the "business purpose" test. It argues that ESG principles, by redefining the purpose of a business beyond mere profit maximisation, could lead to a broader understanding of deductible costs, influence transfer pricing decisions, and impact the application of anti-avoidance measures. It concludes by emphasising the potential of ESG principles to shape the future of taxation, promoting a more sustainable and equitable approach to economic growth.

The purpose of this study is to explore the effect of Environment, Social, and Governance (ESG) scores on Return on Assets (ROA), Risk-Adjusted Return on Capital (RAROC), and Tobin's Q on firm performance. This study used 37 non-financial companies listed on the IDX between 2018 and 2022 in Indonesia companies. Linear and nonlinear panel data regression methods were used on the ESG score and its pillars, resulting in eight different models. The study found a U-shaped impact of ESG scores and social and environmental pillars on ROA. There is a positive linear relationship between ESG scores and the environmental and governance pillars with RAROC, while the social pillar shows an inverted U-shaped effect. However, ESG and its environmental and social pillars have a negative linear relationship with Tobin's Q. The findings suggest the need to manage ESG initiatives strategically, aligning them with financial objectives and awareness of how ESG factors relate to profitability.

The aim of this study is to explore the influence of Environmental, Social, and Governance (ESG) factor on business failure in Brazil by employing advanced machine learning techniques. We collected data from 235 companies and conducted Principal Component Analysis (PCA) on 40 variables already used in the bankruptcy failure literature, resulting in the formation of 7 variables that predict business failure. The results indicate that ESG factor significantly predict business failure in Brazil. This study has implications for investors, policymakers, and business leaders, offering a more precise tool for risk assessment and strategic decision-making.