The impact of ESG ratings on corporate value during COVID-19 pandemic: evidence from China and South Korea

• Published in: Seonmul yeongu (Online) Vol. 32; no. 3; pp. 223 - 237
• Main Authors: Kim, Donghoon, Yoon, Sun-Joong
• Format: Journal Article
• Language: English
• Published: Bingley Emerald Group Publishing Limited 08.08.2024; Emerald Publishing; 한국파생상품학회
• Subjects: Abnormal returns; COVID-19; Economic crisis; Emerging market; Environmental factors; Environmental governance; Environmental social & governance; ESG; Global economy; Hypotheses; Influence; Institutional investments; Insurance effect; International finance; Pandemic; Pandemics; Renewable resources; Risk reduction; Securities markets; Social responsibility; Stock exchanges; Stock prices; Variables; Volatility; 경영학; South Korea; China
• ISSN: 1229-988X; 2713-6647; 2713-6647; 1229-988X
• DOI: 10.1108/JDQS-03-2024-0015

The COVID-19 pandemic has significantly disrupted global economies, posing unprecedented business challenges worldwide. This study examines the influence of Environmental, Social, and Governance (ESG) factors on corporate value in the context of the pandemic, focusing on China and South Korea. Using empirical analysis and data from Chinese A-share and South Korean KOSPI-listed companies, our research reveals complex dynamics. ESG had a negative impact on corporate value during the pandemic. However, firms with higher ESG scores demonstrated an insurance effect, mitigating risk. This effect held in both China and South Korea, highlighting the importance of ESG principles for resilience and sustainable growth in contemporary business practices. This research provides implications for ESG-focused businesses during crises.