ESG Performance and Firm Performance: Evidence from Chinese A-Share Listed Companies

Abstract

This study aims to investigate the impact of corporate Environmental, Social and Governance (ESG) performance on financial performance (measured by return on total assets, ROA). This paper constructs a research framework based on stakeholder theory and sustainable development theory, selects Chinese A-share listed companies as samples, and employs a panel regression model for empirical analysis. The results of hypothesis testing show that good ESG performance significantly enhances corporate ROA. The findings suggest that corporate fulfilment of ESG responsibilities can enhance economic efficiency, confirming the expectations of sustainable development and stakeholder theory, and providing empirical evidence for corporate sustainability strategies and government green policies.