The Influence of Environmental, Social and Governance Performance on Firm

As environmental concerns become more widespread worldwide, nations are concentrating on sustainable development, which has prompted the idea of environmental, social, and governance (ESG). The concept of ESG has developed over the past 20 years since it was introduced in 2004. During this time, the ESG performance of firms has gradually been valued by more and more investors, and has even become an important indicator of corporate selection. This study examines and thoroughly reviews the research advances in the field of ESG performance, taking the literature as the foundation and concentrating on the effect of ESG performance on firms. This study further split ESG performance into ESG disclosure, ESG rating, and ESG investment depending on the structural overview. It then discussed their impacts on firms and forming an integrated framework. The paper finally concludes that firm ESG performance is positively correlated with corporate value, but also points out that the current ESG evaluation system is still flawed and gives corresponding suggestions in the end.