Search Results (835)

The integration of environmental, social and governance (ESG) criteria into corporate and financial decision-making has become one of the most significant transformations in today’s financial markets. Growing regulatory pressure, stakeholder expectations and increased awareness of sustainability challenges have led companies and investors to incorporate ESG considerations into strategic and investment decisions. Despite the rapid spread of ESG practices, the academic literature presents conflicting and sometimes contradictory evidence regarding their economic implications and practical effectiveness. This article provides a review of the literature on the main academic contributions to ESG integration, focusing on three key dimensions: the economic benefits associated with ESG practices, the methodological and credibility challenges relating to ESG measurement, and the organisational and technological factors that enable effective ESG implementation. The findings indicate that ESG integration is generally associated with positive organisational outcomes, including improved financial performance, lower cost of capital, greater stakeholder trust and a reduction in firm-specific risk. However, the realisation of these benefits is not automatic and depends to a large extent on the credibility of ESG practices and information. Rather than endorsing the widely held view that ESG criteria are inherently capable of creating value, the analysis shows that the value-creating effect of ESG criteria depends crucially on the credibility of ESG practices and the quality of their implementation. The literature highlights significant methodological challenges, including rating divergence, the lack of standardised metrics, methodological opacity and the growing risk of greenwashing, which can undermine the reliability of ESG information. This paper proposes an deductive conceptual framework in which ESG effectiveness emerges from the interaction between value creation mechanisms, credibility constraints, and enabling organisational and technological factors. Full article

ESG performance is an important lever for promoting the sustainable development of enterprises. To examine the effect of fund holdings on corporate ESG performance, this study employs the dynamic panel GMM method to perform an empirical analysis using quarterly data of Chinese A-share listed firms from 2009 to 2024. The findings show that public fund holdings contribute to better corporate ESG performance. The analysis of the impact mechanism shows that the improvement effect of public fund holdings on corporate ESG performance is mainly achieved through four channels: increasing information transparency, reducing earnings management, increasing corporate innovation investment, and reducing corporate debt financing costs. Heterogeneity analysis shows that the improvement effect of public fund holdings on corporate ESG performance is more significant in high-tech enterprises, heavily polluting industry enterprises, and enterprises with high analyst attention. Further analysis reveals that different types of institutional holdings have a positive impact on corporate ESG performance. Public fund holdings not only promote corporate ESG performance but also enhance corporate efficiency and reduce operational risks. The research conclusion provides empirical evidence from fund investors on the impact of public fund holdings on corporate sustainable development. Full article

Enterprise green transformation is a strategic response to emerging development concepts and high-quality growth, as well as a key approach to achieving symbiotic integration between firms and their social environment. Using a sample of Chinese A-share listed companies from 2008 to 2023, this paper examines the relationship between corporate social responsibility (CSR) disclosure and green transformation. It further explores the underlying mechanisms, focusing on the role of patient capital as an external governance mechanism within the green governance environment. Empirical results show that CSR disclosure significantly promotes corporate green transformation. Mechanism tests reveal that this effect operates through two channels: alleviating agency costs and easing financing constraints, with patient capital playing a positive moderating role. Additional analyses indicate that the promoting effect of CSR disclosure on green transformation is particularly pronounced in competitive and polluting industries. Full article

Innovation drives long-term firm development, but not all innovations create lasting technological impact. This study investigates how financial technology (FinTech) fosters innovation sustainability by employing a fixed-effects Poisson regression framework and using data from non-financial A-share listed companies in China from 2012 to 2020. Innovation sustainability is measured by forward patent citations within a three-year window, capturing the persistence and external impact of innovations. Our results show that regional FinTech development significantly enhances both the quantity and sustainability of firm innovation. Mechanism analysis reveals that FinTech promotes innovation sustainability by alleviating financing constraints, facilitating digital transformation, and optimizing human capital allocation. These findings provide empirical evidence on the role of FinTech in sustaining firms’ technological contributions and offer actionable insights for policymakers and managers aiming to support high-quality, long-term innovation. Full article

The objective of this study was to explore the impact of exchange rate volatility on corporate financial stability in European corporations, with particular emphasis on the Eurozone and non-Eurozone. The data set of this study consisted of 80 publicly listed non-financial corporations in eight European countries over the period of 2010–2024. The model was able to capture the impact of various macroeconomic changes that affected European corporations in the past few years. The macroeconomic changes that were captured in this study were the European sovereign debt crisis, the COVID-19 pandemic in the world, and the conflict in Ukraine. The financial stability was measured by the Altman Z-score, the leverage ratio, and the current ratio. In this study, the financial impact of the exchange rate was measured by the rolling standard deviations and the conditional volatility with the Generalized Autoregressive Conditional Heteroskedasticity (GARCH) models. The fixed effects model estimation with the System Generalized Method of Moments (GMM) was used in this study. The results of this study showed that the exchange rate volatility was negatively correlated with financial stability in terms of the leverage ratio. However, the Eurozone provides protection against the financial impact of the exchange rate volatility in terms of the leverage ratio. The diagnostic tests in this study were carried out with the Hansen Test and the Arellano-Bond Test. The diagnostic tests confirmed that the results were valid. The significance of this study was that it provided longitudinal data on the impact of the exchange rate on the financial stability of European corporations with particular emphasis on the Eurozone and non-Eurozone. The study also provided new insights on the exchange rate in corporate finance. The Eurozone provides protection against the financial impact of the exchange rate. Full article

The evolution from Industry 4.0 to Industry 6.0 represents a paradigm shift—moving from automation toward an integrated model that incorporates intelligentization, sustainability, and human-centric resilience. While numerous conceptual frameworks have been put forward, empirical research remains scarce, primarily because of the absence of standardized indicators derived from verifiable corporate disclosures. To fill this research gap, the present study develops three quantifiable indices—Intelligence (INT), Sustainability (SUS), and Resilience & Human-centric (RES)—by extracting data from the annual reports and ESG disclosures of 100 Chinese A-share manufacturing enterprises (covering 2022–2024). Fixed-effects panel regression models are employed to assess the impact of these indices on financial performance (ROA, ROE, EPS), market valuation (Tobin’s Q), and sustainability outcomes (ESG ratings). Our findings reveal that INT is the most significant predictor of profitability, with statistically significant positive effects on ROA and ROE—effects that are particularly pronounced among high-tech enterprises. This supports the view that digital capabilities serve as strategic assets. SUS also demonstrates a positive influence on performance, especially in non-high-tech enterprises, where eco-efficiency, regulatory compliance, and ESG-linked financing help offset technological disadvantages. RES contributes to operational and financial stability by enhancing human capital, safety protocols, and organizational practices that reduce performance volatility. Collectively, these results indicate that different types of enterprises follow distinct yet converging pathways toward Industry 6.0: high-tech enterprises capitalize on intelligence to generate innovation rents, while non-high-tech enterprises increasingly rely on sustainability and resilience as strategies to build legitimacy. This study makes significant contributions in three aspects: Methodologically, it differs from previous research that relies on questionnaires and interviews. Instead, it quantifies Industry 6.0 through auditable large-sample key indicators, enhancing the objectivity and operability of the indicators. Empirically, it provides the first empirical evidence on the development path of Industry 6.0 based on data from Chinese manufacturing enterprises. In practical terms, it offers clear references for enterprises and policymakers on the core indicators and their construction framework that should be prioritized during the transformation to Industry 6.0. By linking the index derived from enterprise disclosures with quantifiable performance results, this study effectively bridges the gap between theoretical conceptions and practical applications. It further emphasizes that Industry 6.0 is not merely a technological upgrade but a systematic transformation driven by digitalization, sustainability, and resilience aimed at enhancing enterprise performance and achieving sustainable industrial development. Full article

Environmental taxation, as a market-based regulatory instrument, has the potential to internalize pollution externalities while also promoting the shared goals of environmental protection and economic development. This study investigates the impact of China’s Environmental Protection Tax in 2018 on corporate green investment using a Difference-in-Differences (DID) model and a dataset of A-share listed businesses from 2012 to 2023. Our empirical results show that environmental taxation strongly increases green investment among heavy-polluting enterprises, a finding that holds significant across a range of robustness tests. According to mechanism analysis, the policy functions through two principal channels: an innovation effect that encourages technical upgrades and a financing effect that reduces information asymmetry and credit constraints. Furthermore, the policy has a threshold characteristic: enterprises with higher pollution intensity show more pronounced improvements in ESG performance and investment incentives. This paper gives policy evidence for integrating environmental taxation with green finance to enhance sustainable development, as well as theoretical insights and practical implications for accelerating business low-carbon transition under environmental regulation. Full article

This study explores the impact of internationalization on the financing decisions and finance costs of Chinese enterprises listed in Hong Kong, extending the pecking order theory to an international context. Utilizing data from 785 companies from 2010 to 2020, the research investigates how the degree of internationalization influences corporate finance strategies, with a focus on the mediating role of the pecking order and the moderating effects of international business factors. The findings reveal that while broader internationalization increases finance costs, deeper internationalization reduces them. Legal distance is found to negatively moderate this relationship, whereas the structure of the financial system positively influences it. The results suggest that multinational enterprises with extensive overseas resource allocation demonstrate greater flexibility in financing decisions, particularly in foreign markets characterized by strong investor protection and efficient direct finance mechanisms. Managers should be cautious about pursuing wide geographic expansion without adequate operating depth because a broad but shallow international presence may increase financing frictions. By contrast, deeper resource commitment abroad can strengthen financing flexibility and improve access to lower-cost funds, especially when institutional conditions in the financing market are favorable. Full article

Continuously advancing the digital–intelligent transformation of enterprises is crucial for enhancing their long-term competitiveness and ensuring sustainable development, particularly in emerging market economies. Using a difference-in-differences (DID) approach, this study empirically investigates the impact of government-guided funds (GGFs) on corporate digital–intelligent transformation, drawing on data from Chinese A–share listed firms spanning 2012 to 2024. The results indicate that GGFs significantly promote firms’ digital–intelligent transformation. A mechanism analysis further reveals that GGFs promote this transformation by easing financing constraints, transmitting policy guidance, and encouraging knowledge spillovers. These effects are particularly strong in firms with high-quality internal controls, those operating in high-tech industries, and those with robust dynamic capabilities. Overall, the results provide valuable insights for enhancing government–enterprise collaboration to accelerate economic transformation and strengthen long-term competitiveness. Full article

The persistence of greenwashing as a strategic corporate behavior reflects a financial tradeoff between risk and return. Current literature lacks an integrative framework explaining how these risks and institutional arrangements vary across distinct contexts. This study maps the intellectual structure and contextual heterogeneity of corporate greenwashing research through a bibliometric analysis of 818 publications indexed in the Web of Science Core Collection from 2000 to 2025. The results indicate an evolutionary shift in research focus from early ethical and reputational debates toward empirical investigations of capital market consequences, ESG controversies, and the dark side of corporate sustainability. This transition is accompanied by thematic movement from voluntary disclosure and legitimacy concerns toward mandatory compliance, sustainable finance, green bond pricing, and digital detection using artificial intelligence and natural language processing. The analysis reveals substantial structural heterogeneity. Heavy-asset industries are closely associated with technological decoupling under physical and compliance constraints, whereas financial and service sectors rely heavily on information asymmetry, green label arbitrage, and greenhushing. These sectoral patterns intersect with regional governance trajectories shaped by market-driven, regulation-oriented, and state-led contexts, generating distinct incentive structures and risk conditions, while firm-level governance further moderates these behaviors. The findings position greenwashing as a context-dependent corporate strategy and provide a structured synthesis for future research and differentiated regulatory responses. Full article

This study examines the association between corporate governance and firm-level financial outcomes across the BRICS economies from 2013 to 2023. A multidimensional Corporate Governance Index (CGI), comprising five sub-indices and thirty-one attributes, is constructed to examine how governance frameworks are related to firm-level outcomes in evolving institutional environments. Using panel regression analysis on a dataset of publicly traded firms, the study focuses on three core dimensions of firm performance, i.e., cost of capital (COC), return on capital employed (ROCE), and working capital efficiency (WC). The findings suggest that governance is associated with variations in financing costs and firm performance indicators, although the strength and consistency of these relationships vary across the BRICS economies. The results also highlight cross-country differences, which are interpreted in light of institutional variation in regulatory and enforcement environments across BRICS economies. Additional sensitivity analysis indicates that the findings are not driven by the specific construction of the governance index. Overall, the study contributes to the literature by providing comparative evidence on governance and firm outcomes in emerging markets, while emphasizing that the results should be interpreted as associational rather than causal. Full article

Mining supply chains are strategically important yet difficult to observe because firm-to-firm relationships are fragmented across unstructured public disclosures. This paper applies a retrieval-augmented large language model (LLM) framework to reconstruct mining supply chain networks from unstructured textual data. While the underlying methodology builds on prior work on supply chain mapping using generative AI, the focus here is on its deployment in the mining sector, where structured data on firm-to-firm relationships is particularly limited. The resulting dataset contains 1231 focal mining firms, 4602 directly connected firms, and 8279 directed supplier–customer relationships. The reconstructed network exhibits a pronounced core–periphery structure, with a small number of highly connected firms sustaining a disproportionate share of overall connectivity. We also document strong concentration across countries and mining subsectors, particularly among major mining finance and corporate hubs. Robustness analysis shows that the network is relatively resilient to random node removal but fragments rapidly under targeted removal of central firms. These findings suggest that mining supply chains combine diffuse peripheral structure with systemic dependence on key hub firms, and illustrate how LLM-based methods can serve as a scalable measurement technology for supply chain mapping in data-scarce settings. Full article

Under China’s dual-carbon goals, Green Finance Policy (GFP) and the Environmental Protection Tax Policy (ETP) are key tools for firm-level green transformation, yet their joint micro-effects remain underexplored. Using Shanghai and Shenzhen A-share listed firms from 2011–2022, this study treats the overlapping rollout of the Green Finance Reform and Innovation Pilot Zones and the Environmental Protection Tax reform as a staggered quasi-natural experiment and applies a multi-period DID to identify their synergistic effect on Corporate Green Technology Innovation. Results show that each policy alone promotes green innovation and that their coordination further strengthens the effect. The synergy operates mainly by easing financing constraints and increasing R&D investment. The effect is stronger among firms with better resources, governance, and digitalization, and in regions with stronger institutional environments; it is also more evident in non-heavy-polluting and non-manufacturing sectors. While the policy mix raises both innovation quantity and quality, it does not significantly improve total factor productivity, indicating a “weak Porter effect.” These findings provide micro-level evidence on GFP–ETP synergy and inform the refinement of green finance, environmental tax design, and firm-level green transition policies. Full article

This study constitutes the second part of a comprehensive investigation of the persistence of weighted average cost of capital (WACC) rates despite declining risk-free interest rates. While theory suggests that WACC should reflect lower risk-free interest rates and decline with falling government bond yields, empirical evidence reveals minimal adjustment in the reported WACC figures. Disclosed WACC of DAX40 companies remain between 7% and 8% as the yield of a ten-year German government bond fell from 4.1% to −0.2%. After the quantitative risk analysis (part I) systematically lacks market-based and fundamental explanations—demonstrating that neither systematic risk, overall market risk, earnings risk nor leverage increased sufficiently to justify this stability—this article addresses the resulting explanatory gap through qualitative inquiry. Employing a grounded theory methodology, we investigate the causes and consequences of persistent WACC through systematic analysis of 18 problem-centered semi-structured expert interviews (22 respondents comprising corporate finance executives, investment bankers, strategy consultants, auditors). The investigation reveals that behavioral economics (risk aversion, opportunism, subjectivity), organizational constraints (strategic path dependency, implementation complexity, financial criterion rigidity), and model-theoretic discretion (parameter averaging, analyst influence, supplementary risk adjustments) substantially shape practical WACC determination—factors that quantitative risk analysis cannot capture. Practitioners employ disclosed WACC strategically to reconcile investor return requirements with long-term operational stability, avoid audit friction, and hedge geopolitical–monetary risks—consequences that generate capital opportunity costs offsetting traditional value-maximization objectives. Combined quantitative and qualitative evidence yields actionable insights for value-based capital cost methodologies that are aligned with organizational and market realities. Full article

In the context of intensified trade frictions and frequent financial market fluctuations, assessing the risk resilience of strategic emerging industries holds significant strategic value. Based on quarterly data from 2010 to 2025, this study empirically examines the time-varying and asymmetric shock effects of trade policy uncertainty and financial stress on the profitability of China’s strategic emerging industries using the TVP-VAR-SV model. The study finds that China’s strategic emerging industries exhibit significant asymmetric resilience differences when facing different external shocks, specifically demonstrating stronger trade resilience and weaker financial resilience. The shocks brought by trade uncertainty typically show short-term pain followed by rapid recovery, with the negative impact being largely eliminated within two quarters and subsequently turning into positive growth, reflecting outstanding recovery capability. In contrast, the impact of financial stress on corporate profitability has a profound long-tail effect, with negative disruptions often persisting for more than two years before gradually dissipating. This contrast indicates that trade policy uncertainty and financial stress affect industrial resilience through asymmetric response patterns in terms of impact intensity and persistence. Over time, as autonomy and controllability have improved, the industry’s defensive ability to cope with trade frictions has significantly strengthened, yet credit tightening and liquidity pressure in the financial sector remain the core threats to its profitability recovery. This study not only reveals the asymmetric resilience paths of strategic emerging industries under different external shocks but also provides empirical evidence and policy recommendations for the future improvement of the technology–finance system and the construction of a more resilient domestic industrial chain. Full article