The Impact of Abnormal ESG on Firm Value—Focusing on Voluntary Disclosure on Carbon Emissions

Following the COVID-19 pandemic, investors’ growing focus on sustainable management has increased substantially, drawing greater attention to Environmental, Social and Governance (ESG) practices. This study examines the effect of abnormal ESG investment, defined as ESG activities exceeding the level predicted by firm-specific financial and economic characteristics, on firm value and assesses the moderating role of voluntary carbon emission disclosure. Based on agency theory, the empirical results indicate that abnormal ESG investment is associated with lower firm value, suggesting potential inefficiencies. However, voluntary carbon emission disclosure mitigates this negative relationship by improving transparency, demonstrating environmental accountability, and strengthening investor confidence. By distinguishing economically justified ESG investment from abnormal levels and evaluating the role of voluntary disclosure, this research offers evidence regarding how ESG strategies can be aligned with firm value enhancement in an environment of increasing sustainability expectations.