ESG performance and financial Stability: The moderating effect of CEO characteristics

초록

Environmental, social, and corporate governance (ESG) has become a key consideration-much like the global concept of sustainable development-in corporate operations and investment decisions, influencing various financial indicators of enterprises. Meanwhile, as principal decision-makers and operators, chief executive officers (CEOs) play a pivotal role in corporate management. This study aims to systematically explore how the ESG performance of a company affects its financial stability, and further analyze the moderating mechanism of CEO characteristics in this impact path. This study uses Chinese A-share listed companies from 2010 to 2023 as a sample, adopts a fixed effect model and multiple robustness test methods, and reveals the role path and impact mechanism of ESG in improving corporate financial stability from the perspective of executive behavioral characteristics. The results indicate that corporate ESG performance has a significant positive impact on financial stability. Additionally, executive characteristics (CEO compensation, CEO overconfidence, CEO political connections, etc.) moderate the relationship between ESG and financial risk. This study extends the research on the impact of ESG on financial stability from the perspective of executive characteristics, providing theoretical support for corporate sustainable development strategies. Furthermore, the findings have practical implications for investors considering ESG factors in their investment decisions and offer empirical evidence to support policymakers in formulating ESG-related regulations.

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