RT Article
T1 Environmental, social and governance (ESG) scores and financial performance of multilatinas: moderating effects of geographic international diversification and financial slack
JF Journal of business ethics
VO 168
IS 2
SP 315
OP 334
A1 Duque, Eduardo
A2 Aguilera Caracuel, Javier
LA English
YR 2021
UL https://ixtheo.de/Record/1745672893
AB This paper examines whether a firm’s financial performance (FP) is associated with superior environmental, social and governance (ESG) scores in emerging markets of multinationals in Latin America. The study addresses the current research gap on this issue; it develops hypotheses and tests them by applying linear regressions with a data panel drawn from the Thomson Reuters Eikon™ database to analyse data on 104 multinationals from Brazil, Chile, Colombia, Mexico and Peru between 2011 and 2015. The results suggest that the relationship between the ESG score and FP is significantly statistically negative. Furthermore, in examining environmental, social and governance separately to accurately determine each variable’s relationship to multilatinas’ FP, the results reveal a negative relationship. Finally, the empirical analysis provides evidence for a moderating effect of financial slack and geographic international diversification on the relationship between ESG dimensions and firms’ FP. This study furthers understanding of the relationship between ESG dimensions and FP for the Latin American business context.
K1 Environmental, social and governance dimensions
K1 ESG performance
K1 ESG score
K1 Financial Performance
K1 Geographic international diversification
K1 Financial slack
K1 Emerging market multinationals
K1 Multilatinas
K1 Aufsatz in Zeitschrift
DO 10.1007/s10551-019-04177-w