Does ESG performance have an impact on financial performance?: Evidence from Germany

Publikationen: Beiträge in ZeitschriftenZeitschriftenaufsätze


Purpose - This paper concentrates on environmental, social and governance (ESG) performance in total and divided in each component and their impact on financial performance.
Design/methodology/approach - The study covers a sample selection of companies listed on the German Prime Standard (DAX30, TecDAX, MDAX) for the business years 2010-2014 (412 firm-year observations). A correlation and regression analysis are carried out in order to evaluate possible links between ESG performance as determined by the AssetFour database of Thomson Reuters and accounting and market-based measures of financial performance (ROA and Tobin’s Q).
Findings - ESG performance has a positive impact on ROA but no impact on Tobin’s Q. Furthermore, by analyzing the three different components of ESG performance, governance performance has the strongest impact on financial performance in comparison to environmental and social performance.
Originality/value - The analysis makes a key contribution to the empirical CSR research as we break down ESG performance into their three components and include both accounting-based and market-based financial performance measures for the German setting for the first time. Not only companies but also regulators and researchers are affected by the notion that CSR and financial performance are close together and should be lead to a successful stakeholder management.
ZeitschriftJournal of Global Responsibility
Seiten (von - bis)169-178
Anzahl der Seiten10
PublikationsstatusErschienen - 2017

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