In recent years, the demand for social responsibility arising from sustainable development has led to the gradual formation of a global consensus on the concept of environmental, social and governance (ESG), which has a wide impact on corporate operations. Based on legitimacy theory, this study examines the impact of ESG on corporate profitability. In addition, it explores the effectiveness of cultural distance as a moderator in the relationship between ESG and corporate profitability. Using fixed effects and moderated effects models, this study analyses panel data of Chinese manufacturing multinationals from 2014 to 2021. The results show that ESG significantly and positively affects corporate profitability and that the impact of ESG on corporate profitability is significantly and positively moderated by cultural distance. The research results are expected to provide meaningful insights into the importance of ESG and the factors to be considered by firms in their cross-border investment decision making.
机构:
Chulalongkorn Univ, Sasin Sch Management, Res Unit Sustainabil Finance & Capital Market Dev, Bangkok, Thailand
Univ Western Australia, UWA Business Sch, Perth, WA, AustraliaChulalongkorn Univ, Sasin Sch Management, Res Unit Sustainabil Finance & Capital Market Dev, Bangkok, Thailand
机构:
Zhejiang Normal Univ, Fac Econ & Management, Jinhua 321004, Zhejiang, Peoples R ChinaZhejiang Normal Univ, Fac Econ & Management, Jinhua 321004, Zhejiang, Peoples R China
Zhang, Qiaowen
de Vries, Annalien
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机构:
Stellenbosch Univ, Dept Business Management, ZA-7602 Matieland, South AfricaZhejiang Normal Univ, Fac Econ & Management, Jinhua 321004, Zhejiang, Peoples R China
机构:
Sun Yat Sen Univ, Sch Business, Guangzhou 510275, Peoples R ChinaSun Yat Sen Univ, Sch Business, Guangzhou 510275, Peoples R China
Yuan, Xueying
Li, Zhongfei
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Southern Univ Sci & Technol, Business Sch, Dept Finance, Shenzhen 518055, Peoples R ChinaSun Yat Sen Univ, Sch Business, Guangzhou 510275, Peoples R China
Li, Zhongfei
Xu, Jinhua
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机构:
Guangdong Univ Technol, Sch Management, Guangzhou 510520, Peoples R ChinaSun Yat Sen Univ, Sch Business, Guangzhou 510275, Peoples R China
Xu, Jinhua
Shang, Lixia
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Guangdong Univ Technol, Sch Management, Guangzhou 510520, Peoples R ChinaSun Yat Sen Univ, Sch Business, Guangzhou 510275, Peoples R China