The Impact of ESG Rating Divergence on Corporate Performance: The Mediating Role of Innovation Capacity

Abstract

Against the backdrop of the global transformation of Environmental, Social, and Governance (ESG) policies and the advancement of China’s “dual carbon” goals, ESG rating divergence has become a key barrier restricting the sustainable development of enterprises. This study adopts empirical methods such as fixed effects model and mediating effect model to systematically explore the impact and mechanism of ESG rating divergence on corporate performance, and conducts heterogeneity analysis from three dimensions: geographical location, industrial technological characteristics, and pollution intensity. The results show that: ESG rating divergence significantly inhibits corporate performance, and this conclusion remains valid after robustness tests such as lagged term test and variable replacement; corporate innovation capability plays a partial mediating role between ESG rating divergence and corporate performance; heterogeneity analysis indicates that the inhibitory effect of ESG rating divergence on performance is more significant for enterprises in southern China, high-tech enterprises, and low-pollution enterprises. The conclusions of this study enrich the theoretical research on the economic consequences of ESG ratings, and provide practical implications for regulators to improve the ESG standard system, enterprises to optimize ESG practices and innovation resource allocation, and rating agencies to standardize rating processes.