Decoding ESG: Consumer Perceptions, Ethical Signals and Financial Outcomes

Abstract

This study investigates how consumers respond to firm communications emphasizing Environmental, Social and Governance (ESG) dimensions. Through experimental design, how consumers distinguish among ESG components and how each affects behavioral finance outcomes, including purchase intentions, willingness to buy and brand trust is assessed. Results confirm that consumers perceive the ESG dimensions as distinct from a non-ESG control message. However, the Social and Governance dimensions are perceived as closely related. Importantly, all three dimensions—Environmental, Social, and Governance—significantly improved behavioral outcomes, supporting the persuasive power of ESG messaging. Mediation analyses reveal that perceived ethicality drives these effects across all dimensions, while perceived authenticity plays a stronger mediating role for social messaging. These findings contribute to finance literature by illuminating the consumer-level mechanisms through which ESG communication influences firm value and offer strategic insights for both practitioners and investors seeking to leverage ESG as a market signal.

1. Introduction

As ESG (Environmental, Social, and Governance) factors become increasingly embedded in corporate strategy and investment analysis, understanding their impact on consumer financial behavior remains a critical yet underdeveloped area of research. While institutional investors and asset managers now routinely integrate ESG metrics into portfolio decisions, the extent to which these factors shape consumer responses—particularly in ways that influence firm value—is less understood. Existing literature demonstrates that consumers are responsive to corporate social responsibility (CSR) initiatives, especially those highlighting environmental and social practices (White et al., 2019; Mohr & Webb, 2005). However, most studies conceptualize ESG as a single, undifferentiated construct, leaving open questions about the relative influence of each component on consumer-related financial outcomes.

This study addresses that gap by isolating and testing the effects of E, S, and G dimensions on key behavioral finance outcomes: purchase intention, willingness to buy, and brand trust. These consumer responses are of increasing interest to both corporate finance and marketing scholars, given their role in shaping revenue forecasts, brand equity, and long-term firm valuation. Notably, the governance dimension—central to investor decision-making—remains relatively abstract and underexplored in consumer-facing contexts, possibly due to its low salience in everyday purchasing environments.

The conceptual shift from the Triple Bottom Line (TBL) to ESG has further sharpened the financial relevance of sustainability. While TBL (Elkington, 1997) focused broadly on economic, environmental, and social pillars, ESG criteria provide more measurable and investor-aligned standards (Eccles & Krzus, 2018). This refinement allowed governance—defined by corporate ethics, board accountability, and regulatory compliance—to emerge as a standalone dimension. Importantly, ESG frameworks now serve dual roles: as tools for investment risk assessment and as signals of firm reputation and ethical alignment, both of which have material implications for consumer loyalty and financial performance (Hartmann & Apaolaza-Ibáñez, 2012; Sullivan & Mackenzie, 2017; Murata & Hamori, 2021).

Recent work underscores the interdependency between environmental, social, and governance practices, suggesting that governance mechanisms enhance the credibility and execution of environmental and social strategies (Waites et al., 2024; Guenster et al., 2011; Brammer et al., 2012). Yet, from the consumer’s perspective, the salience of each ESG pillar may vary. While environmental efforts (e.g., carbon reduction) and social commitments (e.g., labor rights, equity) are often highly visible and emotionally resonant, governance tends to operate in the background. Nevertheless, strong governance can serve as a foundational mechanism that enhances trust in a firm’s sustainability efforts (Erben Yavuz et al., 2024; Harrison et al., 2015).

This study poses three research questions that seek to explore the ESG–finance-behavior gap: Do consumers differentiate among the environmental, social, and governance dimensions of ESG? Do these dimensions independently influence behavioral finance outcomes, such as purchase intention, willingness to buy, and brand trust? What is the psychological mechanism underlying these effects?

Experimental design is employed to test responses to ESG messaging framed by each individual dimension. By linking ESG communication to consumer-level behavioral finance outcomes, this study offers a more granular understanding of how ESG affects market-based value creation beyond investor analysis. The findings contribute to both the ESG and financial behavior literature by revealing which components of ESG most effectively drive consumer trust and intention—factors that increasingly inform firm valuation, reputational capital, and long-term risk management (Eccles et al., 2014).

This research makes three key contributions to the literature on ESG and consumer behavior. First, it offers a dimension-specific analysis of ESG communication by experimentally isolating Environmental, Social, and Governance messages—an approach that contrasts with prior studies treating ESG as a unified construct. Second, it identifies distinct psychological mechanisms through which ESG messages influence consumer behavior, revealing that perceived ethicality mediates the effects of all three ESG dimensions, while perceived authenticity plays a unique role in social messaging. Third, the study bridges finance and consumer behavior by linking ESG signals to behavioral finance outcomes—purchase intention, willingness to buy, and brand trust—thereby highlighting how ESG communication can affect firm value through consumer-driven channels.

2. Literature Review: ESG

The rising importance of ESG factors has significantly reshaped corporate strategy and consumer behavior. Initially driven by regulatory and investor demands, ESG now also reflects evolving consumer expectations. Consumers increasingly evaluate companies not only on product quality or price but also on their ESG commitments, influencing behavioral and, in turn, financial outcomes (H. Ahmad et al., 2023; Su & Teo, 2025).

The environmental component of ESG addresses a company’s impact on natural ecosystems, including carbon emissions, resource efficiency, and waste reduction (P. Bansal & Roth, 2000; Clark et al., 2015). Numerous studies indicate that consumers prefer companies that demonstrate environmental responsibility. Many are willing to pay more for sustainable products, especially when companies transparently communicate efforts such as using recyclable packaging or lowering their carbon footprint (H. Ahmad et al., 2023; Su & Teo, 2025).

For example, McKinsey and Company and NielsenIQ (2023) found that a substantial proportion of global consumers are willing to spend more on sustainably marketed products, reinforcing that green marketing can drive financial outcomes. Environmental claims enhance trust, ethical satisfaction, and green purchase intentions (Parguel et al., 2011; Gherghina, 2024)—although real-world behavior may not always align with these intentions unless ESG information is made highly salient (Merrick, 2024). From a financial perspective, environmental initiatives can lead to cost savings, improved market valuation, and better risk management (Eccles et al., 2014).

The social aspect of ESG focuses on a company’s relationships with its employees, communities, and broader society (Ioannou & Serafeim, 2015). Social-oriented ESG communication directly influences conscious consumption, particularly among more socially aware demographics (Maier et al., 2024). Consumers expect firms to uphold social equity and fairness, and they tend to respond negatively to perceived violations (Duan et al., 2023). Social ESG performance has been found to boost employee morale, customer satisfaction, and long-term profitability (Seemann et al., 2023; Seok et al., 2024), and companies with a strong social focus often exhibit superior financial results (Edmans, 2011).

Governance, while less visible to consumers, plays a foundational role in establishing credibility and trust (Jo & Harjoto, 2012). It involves corporate leadership, ethics, internal controls, and shareholder rights. Strong governance ensures transparency, which is increasingly demanded by consumers (Duan et al., 2023; Tripopsakul & Puriwat, 2022). Research confirms that ethical governance enhances the legitimacy of environmental and social efforts, creating a more coherent and trustworthy brand image (Clément et al., 2022; Puriwat & Tripopsakul, 2023).

Good governance also correlates with better operational efficiency, lower cost of capital, and reduced risk (Puriwat & Tripopsakul, 2023). While not always a direct driver of purchase decisions, governance indirectly supports financial performance by fostering consumer confidence and mitigating reputational damage during crises.

The linkage between ESG dimensions helps to shape consumer behavior, impacting financial outcomes. Companies that align environmental, social, and governance strategies in a coherent and transparent manner are more likely to earn brand loyalty (Su & Teo, 2025; N. Ahmad et al., 2021). For instance, strong governance can reinforce the credibility of environmental claims, enhancing purchase intent and willingness to pay a premium (Leonelli et al., 2024).

Consumers who actively seek ESG information tend to show stronger behavioral responses, such as loyalty and advocacy (Leonelli et al., 2024). In financial terms, comprehensive ESG strategies translate into increased market valuation, improved capital access, and long-term resilience (Puriwat & Tripopsakul, 2023).

3. Hypothesis Development

Recent advances in sustainability research and responsible investing have encouraged firms to communicate their ESG performance more transparently. The public is not passive in receiving these messages—they actively process and interpret ESG claims based on relevance, salience, and credibility (Sen & Bhattacharya, 2001; White et al., 2019). However, while ESG is often treated as a cohesive framework in financial and corporate reporting (Eccles & Klimenko, 2019), consumers may interpret its individual dimensions differently, influenced by how each aligns with their values and expectations (Mohr & Webb, 2005; Schons & Steinmeier, 2016).

Environmental messages (e.g., carbon footprint, energy use) are often perceived as distinct and outcomes-oriented, focusing on ecological impact and long-term planetary health (P. Bansal & Roth, 2000). By contrast, social and governance messages are more process-oriented and concern human-centric or organizational ethics, such as labor practices, diversity, and board accountability (Hartmann & Apaolaza-Ibáñez, 2012). From a finance perspective, Social and Governance elements are both associated with non-financial risk mitigation—they are used by investors to assess firm reputation, operational integrity, and regulatory compliance (Khan et al., 2016). This conceptual closeness may also translate into consumer perception, where Social and Governance components are viewed as more interrelated than Environmental factors due to their shared focus on internal organizational behavior and ethical conduct (Harrison et al., 2015).

Cognitive processing theories in consumer psychology suggest that individuals use schema-based categorization when interpreting complex information (Loken et al., 2008). As a result, consumers may mentally group Social and Governance initiatives together more closely under an ethical umbrella (Buell & Kalkanci, 2021). Therefore, although consumers can distinguish between ESG dimensions, they are likely to perceive greater conceptual proximity between Social and Governance factors.

Hypothesis 1:

Consumers are able to differentiate between the Environmental, Social, and Governance dimensions of ESG messaging, although Social and Governance dimensions are perceived as closely related.

As ESG considerations become increasingly integrated into both corporate strategy and investor evaluation, they are also playing a more prominent role in shaping consumer perceptions and behaviors. ESG-related communication signals corporate ethicality, which has been shown to positively influence key behavioral finance outcomes (Becker-Olsen et al., 2006; Mohr & Webb, 2005). These behavioral responses are rooted in consumers’ desire to align their values with those of the brands they support, especially in contexts involving sustainability or social impact (White et al., 2019).

In financial terms, ESG commitments are increasingly viewed as indicators of non-financial performance (Salem et al., 2024), contributing to intangible asset valuation and long-term risk mitigation (Friede et al., 2015). Investors consider these attributes in evaluating a firm’s reputation, stakeholder trust, and resilience, while consumers similarly use ESG cues to assess a company’s broader reputational capital and ethical standing (Eccles et al., 2014). Signaling theory (Spence, 1973) supports this view by suggesting that voluntary disclosures, such as ESG messaging, serve as credible signals of firm quality in both financial and consumer markets.

Importantly, research shows that any form of ESG engagement, even when limited to one dimension (e.g., only environmental or only governance), can enhance consumer attitudes toward a brand relative to companies with no apparent ESG stance (Hartmann & Apaolaza-Ibáñez, 2012; Waites et al., 2024). Thus, whether the focus is environmental stewardship, social impact, or corporate governance, communicating a commitment to any ESG dimension is likely to produce positive behavioral finance outcomes among consumers.

Hypothesis 2:

Consumers exhibit higher (a) purchase intentions, (b) willingness to buy, and (c) brand trust toward companies that communicate a commitment to any dimension of ESG (Environmental, Social, or Governance), compared to companies that do not.

As ESG communication becomes more prevalent in corporate disclosure and brand messaging, understanding the psychological mechanisms through which it influences behavior is critical. One such mechanism is perceived ethicality, which refers to consumers’ judgments about a firm’s moral character based on its actions and values (Brunk, 2010). Ethical perception plays a central role in driving trust, loyalty, and purchase-related behaviors (Schmeltz, 2012; Lichtenstein et al., 2004).

Each dimension of ESG offers a different pathway through which firms can be evaluated as ethical. Environmental initiatives signal responsibility toward planetary welfare (P. Bansal & Roth, 2000). Social efforts indicate care for societal well-being and human rights (Sen & Bhattacharya, 2001). Governance practices are viewed as internal accountability mechanisms that reinforce ethical integrity (Jo & Harjoto, 2012). Regardless of the dimension, consumers interpret these actions through an ethical lens, shaping their perceptions of the firm.

The mediation role of perceived ethicality aligns with attribution theory, which posits that consumers assess not just what a firm does, but why it does it (Foreh & Grier, 2003). If ESG efforts are seen as sincere and consistent with the firm’s identity, they enhance ethical perceptions (Yoon et al., 2006), which in turn should boost purchase intentions, willingness to buy, and brand trust. Ethicality also relates to non-financial risk assessment. Stakeholders—including consumers—use ethical cues to evaluate long-term stability and credibility (Eccles et al., 2014). Thus, perceived ethicality acts as a bridge linking ESG messaging with both consumer-facing and market-facing value.

Hypothesis 3:

Perceived ethicality mediates the relationship between each ESG dimension (Environmental, Social, and Governance) and (a) purchase intentions, (b) willingness to buy, and (c) brand trust.

4. Methods

The purpose of this study is to test the conceptual model (see Figure 1) to understand how consumers perceive each dimension of ESG and what potential impact these perceptions might have on behavioral financial outcomes. The underlying mechanism driving the increase in these behavioral outcomes is also explored.

4.1. Procedure

A total of 245 respondents were recruited from Prolific (participants were limited to the United States and United Kingdom) and paid to participate in this study. The average age of participants was 39 (SD = 12.16), and the sample was approximately 53% men. Appeals were created depicting a fictitious coffee company making either an environmental (n = 61), social (n = 61), governance (n = 61), or taste (control; n = 62) claim. The environmental claim describes the coffee as using renewable energy to reduce their environmental footprint. The social claim describes the coffee company as ensuring fair pay for their farmers, and the governance claim describes the coffee company as having strong ethical standards. The control condition focuses on taste. Participants were randomly assigned to view one of the four scenarios.

After viewing the scenario, participants were asked to answer the questions measuring purchase intentions (α = 0.97), willingness to buy (α = 0.91), and brand trust (α = 0.95). Next, perceptions of ethicality (α = 0.96) and authenticity (α = 0.95) were collected. Participants were also asked to answer questions assessing their environmental (α = 0.93), social (α = 0.94), and governance (α = 0.93) perceptions of the company. At the conclusion of the study, demographic information was collected. Measures and manipulations are located in Appendix A and Appendix B.

4.2. Results and Discussion

ESG Perceptions Analyses. First, the perceptions of each dimension of ESG were assessed. The results of a one-way ANOVAs indicate that there was a significant difference in environmental (F(3 241) = 20.62, p < 0.01), social (F(3 241) = 25.17, p < 0.01), and governance (F(3 241) = 28.10, p < 0.01) perceptions across the environmental, social, governance and control scenarios. Each ESG condition was significantly different from the Control on its respective manipulation check scale, indicating successful differentiation from the baseline (see

Table 1. Analyses of ESG Perceptions.

	Environmental Perceptions		Social Perceptions		Governance Perceptions
Scenario	M (SD)	t-Values	M (SD)	t-Values	M (SD)	t-Values
Environmental	5.60 (1.07)		4.89 (0.96)	4.77 **	5.35 (0.97)	2.03 *
Social	5.02 (1.21)	3.51 **	5.70 (0.89)		5.70 (0.95)	0.05
Goverance	4.91 (1.10)	2.79 **	5.17 (1.02)	3.05 **	5.71 (0.98)
Control	3.95 (1.31)	7.59 **	4.16 (1.12)	8.42 **	4.23 (1.19)	7.47 **

Note: * = p ≤ 0.05; ** = p < 0.01; M = Mean; SD = Standard Deviation.

).

Specifically, participants in the environmental scenario rated the company significantly higher on environmental perceptions (M = 5.60, SD = 1.07) than those in the control group (M = 3.95, SD = 1.31; t = 7.59, p < 0.01), indicating a strong manipulation effect. Environmental perceptions were also significantly higher in the environmental scenario compared to the social (t = 3.51, p < 0.01) and governance (t = 2.79, p < 0.01) conditions, confirming that this scenario more effectively signaled environmental commitment. For social perceptions, the highest ratings were found in the social scenario (M = 5.70, SD = 0.89), which were significantly greater than the control (M = 4.16, SD = 1.12; t = 8.42, p < 0.01), environmental (t = 4.77, p < 0.01), and governance (t = 3.05, p < 0.01) scenarios. Likewise, governance perceptions were significantly higher in the governance scenario (M = 5.71, SD = 0.98) compared to the control (M = 4.23, SD = 1.19; t = 7.47, p < 0.01). However, the differences between the governance scenario and other ESG conditions on governance perceptions were not statistically significant, suggesting some conceptual overlap in how participants interpreted these cues. These results support the successful differentiation of ESG messaging by dimension, particularly for environmental and social perceptions.

Table 1 presents the mean participant ratings for the ESG perception measures, which assessed perceived alignment between the company’s message and each ESG dimension. Participants rated the extent to which the company was perceived as environmentally responsible, socially conscious, or well-governed based on the scenario they were exposed to. These perceptions were measured using three-item scales, each on a 7-point Likert scale (1 = Strongly disagree, 7 = Strongly agree). The values shown in the table are mean scores across participants in each condition; higher values indicate stronger perceived alignment with the relevant ESG attribute.

In comparing the ESG conditions against one another, the environmental scenario was found to be significantly distinct from both the social and governance conditions on environmental perceptions, supporting the successful isolation of that dimension. Similarly, social perceptions were significantly higher in the social condition compared to both the environmental and governance scenarios. However, the governance and social conditions did not significantly differ on the governance perception scale (p > 0.05), indicating a potential conceptual overlap between these two dimensions. This aligns with prior literature suggesting that consumers may view governance-related practices—such as board diversity, ethical leadership, and transparency—as inherently linked to a firm’s social performance (Aguilera et al., 2006). As a result, the boundaries between the social and governance dimensions may be more cognitively blurred than those between environmental and either of the other two. These findings provide empirical support for H1, confirming that, while consumers are generally able to distinguish between ESG dimensions, the social and governance elements may be perceived as more connected. Because each ESG condition differed significantly from the control and manipulation checks aligned with their intended constructs, the analysis of the dependent outcome variables was conducted next.

Dependent Variables Analyses. Consumer responses related to purchase intentions, willingness to buy, and brand trust were examined using one-way ANOVAs. The results revealed significant differences across the scenarios for purchase intentions (F(3 241) = 3.39, p = 0.02), willingness to buy (F(3 241) = 5.38, p = 0.01), and brand trust (F(3 241) = 9.31, p < 0.01). These findings indicate that the type of ESG message presented influenced consumers’ behavioral outcomes. As shown in

Table 2. Analyses of Dependent Variables.

	Purchase Intentions	Willingness to Buy	Brand Trust
Scenario	M (SD)	M (SD)	M (SD)
Environmental	5.43 (1.34)	6.48 (1.94)	5.86 (1.86)
Social	5.40 (1.32)	6.57 (1.83)	6.53 (1.92)
Governance	5.40 (1.56)	6.62 (2.25)	6.23 (1.94)
Control	4.71 (1.67)	5.27 (2.11)	4.80 (2.02)

Note: M = Mean; SD = Standard Deviation.

, participants exposed to ESG messaging reported consistently higher purchase-related responses than those in the control group. This suggests that communicating a firm’s commitment to environmental, social, or governance principles can meaningfully enhance consumer engagement and trust. The results provide support for H2 and highlight the persuasive potential of ESG-aligned communications in shaping favorable consumer behavior.

Across all three outcome variables, participants in the ESG conditions reported more favorable behavioral responses than those in the control group. Specifically, purchase intentions were higher in the environmental (M = 5.43, SD = 1.34), social (M = 5.40, SD = 1.32), and governance (M = 5.40, SD = 1.56) conditions relative to the control (M = 4.71, SD = 1.67), indicating that ESG messaging positively influences consumers’ intent to purchase. A similar pattern was observed for willingness to buy, with higher ratings in the environmental (M = 6.48), social (M = 6.57), and governance (M = 6.62) conditions compared to the control (M = 5.27).

Brand trust also followed this trend: participants expressed greater trust in the brand when exposed to any ESG message, with the highest trust in the social condition (M = 6.53), followed by governance (M = 6.23) and environmental (M = 5.86), all of which exceeded the control (M = 4.80). These results suggest that communicating a commitment to any dimension of ESG—whether environmental sustainability, social responsibility, or governance practices—can enhance consumers’ behavioral intentions and trust compared to no ESG message. While the three ESG conditions yielded similarly high outcomes, the social dimension produced the highest brand trust, suggesting that it may be particularly effective in building consumer confidence. These findings offer support for H2.

Table 2 reports mean scores for the dependent variables used to evaluate consumer responses to ESG messaging. Higher scores reflect more favorable evaluations (e.g., greater trust or stronger intent to purchase). The values represent the average participant ratings in each ESG scenario condition. Scores across the ESG conditions were consistently higher than those in the control condition, indicating that ESG messaging positively influenced these consumer outcomes.

Mediation Analyses. Though perceived ethics are predicted to mediate the relationship between ESG and behavioral outcomes, it is possible that perceptions of authenticity might also influence this relationship. While ethical perceptions often shape consumer responses to ESG initiatives (Syarkani et al., 2023; Rahat & Nguyen, 2024), research also highlights authenticity as a key driver of trust and behavioral intentions, suggesting it may play a mediating role as well (Becker et al., 2019). To examine the mediating roles of perceived ethicality (M = 5.29, SD = 1.22) and authenticity (M = 5.36, SD = 1.12) in purchase intentions, willingness to buy, and brand trust, PROCESS (Hayes, 2022) model 4 with 5000 bias corrected bootstrap samples was used.

Results of this analyses revealed that perceptions of ethicality were positively and significantly influenced by the environmental (a = 1.34, SE = 0.19, t = 7.19, p < 0.0), social (a = 1.73, SE = 0.19, t = 9.26, p < 0.01), and governance (a = 1.22, SE = 0.19, t = 6.56, p < 0.01) conditions. However, perceptions of authenticity were only significantly influenced by the social condition (a = 0.69, SE = 0.20, t = 3.46, p < 0.01), and not the environmental (a = 0.32, SE = 0.20, t = 1.62, p = 0.11) and governance (a = 0.24, SE = 0.20, t = 1.22, p = 0.22) conditions.

Ethicality significantly predicted purchase intentions (b = 0.48, SE = 0.09, t = 5.21, p < 0.01), willingness to buy (b = 0.66, SE = 0.12, t = 5.60, p < 0.01), and brand trust (b = 0.78, SE = 0.09, t = 8.75, p < 0.01). Likewise, authenticity significantly predicted purchase intentions (b = 0.52, SE = 0.08, t = 5.95, p < 0.01), willingness to buy (b = 0.82, SE = 0.11, t = 7.35, p < 0.01), and brand trust (b = 0.88, SE = 0.08, t = 10.60, p < 0.01).

Bootstrapped analysis revealed a significant indirect effect through perceived ethics for all ESG dimensions for purchase intentions, willingness to buy, and brand trust, supporting hypothesis 3. However, for authenticity, only the social dimensions revealed a significant indirect effect for purchase intentions, willingness to buy, and brand trust. The environmental and governance dimensions were not significant through authenticity for any of the dependent variables. See

Table 3. Mediation Analyses: Indirect Effects.

Mediation Analyses: Indirect Effects
	Purchase Intentions			Willingness to Buy			Brand Trust
Ethicality	a*b	LLCI	ULCI	a*b	LLCI	ULCI	a*b	LLCI	ULCI
Environmental	0.65	0.34	1.01	0.89	0.53	1.30	1.04	0.66	1.48
Social	0.83	0.46	1.25	1.15	0.73	1.61	1.34	0.91	1.85
Goverance	0.59	0.30	0.94	0.81	0.47	1.22	0.95	0.57	1.41
Authenticity	a*b	LLCI	ULCI	a*b	LLCI	ULCI	a*b	LLCI	ULCI
Environmental	0.17	−0.03	0.38	0.26	−0.04	0.60	0.28	−0.05	0.61
Social	0.36	0.15	0.62	0.56	0.26	0.92	0.61	0.28	0.95
Goverance	0.13	−0.10	0.38	0.20	−0.15	0.58	0.21	−0.17	0.61

.

The unique significance of the social dimension in predicting authenticity aligns with prior research indicating that socially responsible actions—such as fair treatment of employees, diversity, and community engagement—are more directly perceived by consumers as reflective of a brand’s values and moral character (Bhattacharya & Sen, 2004; Pérez & Rodríguez del Bosque, 2015), thereby enhancing perceived authenticity more than environmental or governance efforts.

5. General Discussion

This study examined the differentiated effects of ESG messaging on key consumer behavioral finance outcomes—purchase intention, willingness to buy, and brand trust—while also exploring the mediating role of perceived ethicality and authenticity. The results yield three important insights. First, consumers are capable of differentiate among ESG dimensions, although Social and Governance messaging were perceived as conceptually overlapping. Second, all three ESG dimensions individually and significantly improved behavioral intentions compared to a control condition, confirming the general positive influence of ESG messaging. Third, perceived ethicality mediated these effects across all ESG types, while perceived authenticity only mediated the influence of the social dimension. These results highlight how distinct ESG signals, though differing in salience, can influence consumer-driven value creation.

5.1. Theoretical Implications

This study advances theoretical work on ESG by offering dimension specific insights where these constructs have primarily been grouped together (Eccles & Klimenko, 2019; Friede et al., 2015). In line with signaling theory (Spence, 1973), the finding that each ESG message independently improves behavioral intentions suggests that consumers interpret ESG messaging as a credible signal of firm ethical orientation. These messages serve to reduce information gaps and build credibility with consumers, thereby influencing intangible firm assets like brand equity and reputational capital (Eccles et al., 2014).

Moreover, the conceptual overlap between the social and governance dimensions aligns with schema-based categorization, where similar themes—such as ethics, fairness, and accountability—are cognitively grouped (Loken et al., 2010). The significant mediation by perceived ethicality across all three ESG dimensions builds upon prior work by Singh et al. (2012), confirming that ethical judgments serve as a key pathway linking ESG efforts to consumer trust and financial behavior. The authenticity effect observed for the social dimension aligns with prior research indicating that emotionally resonant, human-centered narratives enhance the perceived sincerity and credibility of corporate messaging (Becker et al., 2019; Bhattacharya & Sen, 2004).

5.2. Practitioner Implications

For financial strategists and brand managers, these findings reinforce ESG’s potential to drive consumer-based financial performance. Firms can benefit from communicating any of the three ESG pillars, as each has a measurable, positive influence on consumer purchase intentions, willingness to buy, and brand trust. Importantly, while all three dimensions are effective, social messaging also appears to uniquely enhance perceptions of authenticity, which further strengthens behavioral responses. This suggests that practitioners should not only integrate ESG commitments across corporate strategy but also craft tailored communication strategies that align each dimension with consumer values.

From an investor’s perspective, these consumer-based findings offer complementary insight into firm value. ESG messaging shapes consumer behavior, which feed into revenue forecasts, brand equity, and risk mitigation—factors increasingly used in financial valuation models (Khan et al., 2016). Furthermore, strong governance messaging, though often undervalued in consumer markets, demonstrated significant behavioral impact, highlighting the importance of making governance commitments more accessible and transparent to consumers.

5.3. Limitations and Future Research

As with all research, the present study has several limitations that offer opportunities for future inquiry. First, although the use of a fictitious coffee brand enabled experimental control and internal validity, it may limit ecological validity. Real-world responses may differ when interacting with recognizable brands due to existing brand perceptions, trust, or loyalty. Future research should examine how prior brand knowledge impacts consumer behavior. Additionally, the product category—coffee—is a relatively low-involvement, fast-moving consumer good. ESG messaging may have different or more pronounced effects in higher-involvement industries such as fashion, banking, energy, or technology, where ethical concerns are more salient.

Second, the study isolated Environmental, Social, and Governance dimensions in separate conditions. While this allowed for clarity in measurement, communicating integrated ESG strategies may produce synergistic or even conflicting effects. Future research should examine how combined ESG messaging influences consumer perception, especially when dimensions align or contradict. Furthermore, although the governance dimension was shown to positively influence behavioral outcomes, the study did not explore which specific governance elements (e.g., board diversity, anti-corruption, transparency) are most influential or how to make such messages more salient in consumer-facing contexts. Additional research is needed to fully explore how governance initiatives are perceived.

Third, the sample was limited to participants from the United States and United Kingdom. Cultural values, regulatory environments, and consumer expectations around ESG vary globally, and future research should explore cross-cultural differences in ESG perception and response. ESG salience and interpretation may differ based on local norms and regulatory environments (Brammer et al., 2007). Additionally, the study relied on self-reported behavioral outcomes (e.g., willingness to buy, brand trust), which are subject to social desirability bias (Fisher, 1993) and may not always predict actual behavior (Morwitz, 2014). Future studies should consider behavioral or field-based measures to enhance external validity.

Fourth, while this study examined perceived ethicality and authenticity as mediators, other psychological mechanisms—such as perceived competence, emotional connection, or brand reputation—could also play important roles in how consumers interpret ESG messages. Including these variables in future models may offer a more comprehensive understanding of ESG’s influence. Furthermore, individual-level moderators such as political ideology, ethical sensitivity, or environmental concern may shape ESG message processing and should be explored in future studies.

Finally, this research offers a snapshot of consumer responses to ESG messaging but does not assess the longevity or durability of these effects. It remains unclear whether these responses persist over time, especially in light of growing concerns about greenwashing. Longitudinal studies or repeated exposure experiments could help determine whether ESG messaging sustains or diminishes consumer trust and behavioral intent. Additionally, future research should investigate potential consumer backlash or skepticism toward insincere or overly promotional ESG claims, as well as the cost-benefit implications for firms seeking to implement ESG communication strategies.

6. Conclusions

This study provides empirical evidence that consumers positively respond to corporate ESG messaging across all three dimensions through mechanisms of perceived ethicality and, in the case of social messaging, perceived authenticity. These insights have strategic implications for firms, as they highlight ESG communication as a lever for influencing consumer trust and behavior, with potential downstream effects on firm valuation. As ESG continues to evolve from a compliance tool to a market signal, understanding its consumer-facing dimensions will be essential for building sustainable competitive advantage and long-term financial value.