The Impact of ESG Performance on Corporate Foreign Shareholding: Empirical Evidence from Chinese A-Share Listed Companies on the Shanghai and Shenzhen Stock Exchanges
DOI:
https://doi.org/10.54097/v4wc6b20Keywords:
ESG Performance, Foreign Shareholding, Information Disclosure Quality, Internal Control QualityAbstract
Against the backdrop of the mainstreaming of ESG principles, ESG performance is becoming one of the important factors influencing investors' investment decisions. Using Chinese A-share listed companies on the Shanghai and Shenzhen Stock Exchanges from 2012 to 2024 as the research sample, this study empirically examines the impact of ESG performance on corporate foreign shareholding. The results show that firms with strong ESG performance can promote corporate foreign shareholding behavior. Mechanism analysis reveals that ESG performance promotes foreign shareholding behavior mainly by improving information disclosure quality and enhancing internal control quality. Heterogeneity analysis indicates that the promoting effect of ESG performance on foreign shareholding is more pronounced in the subsamples of non-state-owned enterprises, firms with lower financial flexibility, firms with poorer annual report readability, and firms audited by non-Big Four auditors. The conclusions have positive implications for gaining a deeper understanding of how ESG performance affects foreign shareholding ratios, better improving the ESG information disclosure policy framework, and deepening foreign investment.
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