The Impact of ESG Performance on Corporate Value : Focusing on Managerial Characteristics

Purpose It analyzes how ESG management (environment, society, and governance) affects corporate value and analyzes whether these correlations differ according to the CEO’s personal characteristics to further confirm the CEO’s role in ESG activities. Through this, it is intended to present a new perspective on the characteristics of managers and provide an opportunity to increase the importance of ESG activities. Methodology This study collected data from 2,469 companies listed on the Korea Exchange from 2020 to 2022. The data included ESG activity metrics, demographic characteristics of managers, overconfidence, and capabilities. Using multiple regression analysis, the relationship between managerial characteristics and ESG activities was examined. Findings The results indicate that managers with higher levels of overconfidence tend to participate more actively in ESG activities. Additionally, the higher the managerial capability, the more vigorous the ESG activities, which positively influenced corporate value. Implications This study suggests that companies can actively introduce and effectively perform ESG management to improve corporate value. In particular, managers with excellent abilities can actively implement ESG management to improve the corporate image, improve the company’s sustainable management, and maintain the company’s long －term competitive advantage. It can help companies and investors recognize this fact. In the future, more efficient ESG management and investment strategies will be established in consideration of the characteristics of the CEO in the management and investment process.