Do major international customers in global supply chains enhance corporate ESG performance? Evidence from Chinese listed companies in high-emission industries

Using data from Chinese listed companies in high-emission industries, this article examines how major international customers (MICs) affect suppliers’ ESG performance. We find that firms with major international customers improve their ESG performance, which is further enhanced as the number of such customers increases. Mechanism analysis reveals that this improvement is mediated by firms’ green innovation performance and executive incentives. Furthermore, the enhancing effect is stronger for firms appointing fewer executives with overseas experience or firms in low-trade-intensity regions. European Union customers also exert a greater positive effect on ESG performance. This study highlights the governance value of international supply chains in advancing corporate ESG practices.