Environmental, Social and Governance (ESG) Phases and Circulation
DOI:
https://doi.org/10.54097/zwfcyc95Keywords:
ESG, disclosure, rating, investment, cycle, enterprise.Abstract
With the increasing impact of environmental, social and governance (ESG) on the world, this paper aims to discuss the current situation of ESG applications in China and abroad, as well as the corresponding impact of ESG disclosure, rating and investment. Furthermore, the paper adopts a systematic review method to sort out related literatures in the field of ESG, and then discusses the interaction of the three parts and the cyclical role of the components. The discussion found that investors attach great importance to the ESG disclosure and rating, and more and more mainstream investors are incorporating ESG factors into their investment decision-making process. Moreover, ESG disclosure, rating and investment are complementary to each other. If an enterprise discloses ESG information well, it will receive a relatively impressive ESG rating, which will ultimately attract more investors. Subsequently, as investment increases, companies will pay more attention to ESG disclosure, creating a virtuous circle.
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