Transformations  in
Business & Economics

CAN ENVIRONMENT, SOCIAL, AND GOVERNANCE PERFORMANCE IMPROVE THE HIGH-QUALITY DEVELOPMENT OF EQUIPMENT MANUFACTURING COMPANIES?²
Qingyuan Shen, Jiulong Zhu, Mingxia Qi, Xiaoyan Tao

ABSTRACT: ESG (Environment, Social, and Governance) concepts and corporate high-quality development have become the focus of academic attention, but existing literature has not provided a systematic theoretical insight into how ESG performance affects corporate high-quality development. To address the abovementioned research gap, using the panel data of Chinese A-share equipment manufacturing listed companies from 2012 to 2021, based on principal-agent theory and signaling theory, the effect of the ESG responsibility fulfillment on the enterprise high-quality development and the mediating role of green technological innovation in this relationship were explored, and the levels of high-quality development of equipment manufacturing companies were measured by using the entropy-weighted TOPSIS (Technique for Order Preference by Similarity to an Ideal Solution) method. Results reveal that ESG performance has a positive linear impact on the high-quality development of equipment manufacturing companies, with no evidence of a non-linear effect. Specifically, dimensions individually play promotive roles in the high-quality development of equipment manufacturing companies. Furthermore, ESG performance positively drives corporate high-quality development through significant mediation of green technological innovation. The promotive effect of ESG performance on high-quality development is greater for non-state-owned equipment manufacturing companies than for state-owned enterprises. Additionally, the positive impact of ESG performance is significant on the high-quality development of equipment manufacturing companies in eastern regions but not significant in other regions. Conclusions provide valuable insights for equipment manufacturing companies to understand the effects of ESG performance on their high-quality development and to formulate appropriate differentiated strategies.

KEYWORDS:  ESG performance, equipment manufacturing enterprises, high-quality development, green technology innovation

JEL classification:  D24, G32, M14

²Acknowledgments:  This research achievement was funded by the National Postdoctoral Research Program (No. GZC20230652), the Achievements of the Humanities and Social Sciences Research Youth Fund Project of the Ministry of Education (No. 23YJC630148), the National Social Science Foundation of China (No. 20BGL192), the National Social Science Foundation of China (No. 21BGL248), the Annual Project of Henan Provincial Philosophy and Social Science Planning (No. 2022CJJ173), the Scientific and Technological Innovation Teams in Universities in Henan Province (No. 24IRTSTHN028).