Financial Performance and ESG Sustainability of the Electronics Industry in Europe: A Quantitative Approach

Europe’s technological and sustainable transition will be possible, even and especially if the electronics industry adapts its production standards. This industry could become a testing ground because it raises serious environmental and social issues. This study critically evaluates the relationships between the economic and financial performance of NACE 26 companies and their environmental, social, and governance (ESG) performance. It uses data from the financial statements of numerous companies over a decade to determine whether the sustainable activities adopted by these companies have impacted their profitability, operational efficiency, and qualitative and quantitative capital structure. The research is conducted through a multilevel quantitative analysis, combining descriptive approaches, multiple regression, and path analysis. The study’s findings indicate that the adoption of ESG strategies improves companies’ competitiveness and resilience in the medium to long term. In the short term, however, ESG strategies cause a slight reduction in profitability, primarily due to the costs associated with green investments. Effective governance is crucial for enhancing operational efficiency and cultivating a mutually beneficial and positive relationship between sustainability, digital innovation, and value creation.