From ESG integration to financial sustainability: The roles of internationalization orientation, innovation, and ESG authenticity in Thai listed firms

This study investigates how perceived environmental, social, and governance (ESG) regulatory pressure influences financial sustainability performance through ESG integration capability, internationalization orientation, sustainability innovation, and perceived ESG authenticity. Using survey data from 279 Thai listed firms, partial least squares structural equation modelling (PLS-SEM) was employed to test the proposed model. The results show that perceived ESG regulatory pressure positively influences both ESG integration capability and financial sustainability performance. ESG integration capability also positively affects internationalization orientation and aggregated sustainability innovation. Aggregated sustainability innovation enhances perceived ESG authenticity, whereas internationalization orientation shows a weaker but significant negative association with perceived ESG authenticity. This suggests that, among Thai listed firms, visible sustainability innovation strengthens internal perceptions of ESG credibility, while internationalization may create skepticism when global expansion is not clearly supported by substantive ESG practices. Perceived ESG authenticity, measured as internal perceptions of the credibility and sincerity of ESG practices, strongly improves financial sustainability performance. Perceived greenwashing tendency weakens the positive effects of ESG integration capability on internationalization orientation and aggregated sustainability innovation, indicating that perceived inconsistency or exaggeration can reduce the strategic value of ESG capability. The study contributes by explaining how external ESG regulatory pressure is translated into ESG integration capability and subsequent organizational and perceptual mechanisms that shape financial sustainability performance. The findings suggest that ESG capability alone is insufficient unless translated into credible sustainability innovation and authentic ESG practices.