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From corporate social responsability to environmental, social, governance investing: non-financial reporting - benefits and legislative implications

Author

Listed:
  • Komalpreet Kaur

    (“Aurel Vlaicu” University of Arad, Arad, Romania)

  • Daniela Corina Oprea (Bîrlă)

    (West University of Timișoara, Timișoara, Romania)

  • Raluca Simina Bilți

    (“Aurel Vlaicu” University of Arad, Arad, Romania)

  • Vanina Adoriana Trifan

    (“Aurel Vlaicu” University of Arad, Arad, Romania)

Abstract

The main objective of the paper is to highlight the importance of ESG (Environment, Social, Governance) investing for companies, while also elaborating its relation to better financial performance. Furthermore, the article conducts a literature review by analysing the already existing scientific papers (mainly from Google Scholar, Web of Science and ScienceDirect) to demonstrate how the relative importance of each of the ESG dimensions: Environmental, Social and Governance, may vary depending on different factors. The article highlights the value of non-financial reporting, its advantages, and the resulting legal ramifications. Investors and executors have recognized the importance of the ESG framework in recent years, which has helped it earn a lot of respect. The framework is said to serve several benefits, such as offering business sustainability, financial stability, and better financial performance, to a given economic entity. Similarly, the paper presents practical implications for the businesses, as it leads to their better understanding of the concept, from an investor’s perspective.

Suggested Citation

  • Komalpreet Kaur & Daniela Corina Oprea (Bîrlă) & Raluca Simina Bilți & Vanina Adoriana Trifan, 2023. "From corporate social responsability to environmental, social, governance investing: non-financial reporting - benefits and legislative implications," Journal of Financial Studies, Institute of Financial Studies, vol. 8(Special-J), pages 117-128, June.
    • Handle: RePEc:fst:rfsisf:v:8:y:2023:i:special-june_2023:p:117-128
    DOI: 10.55654/JFS.2023.SP.08
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    References listed on IDEAS

    as
    1. Pineau, Edouard & Le, Phuong & Estran, Rémy, 2022. "Importance of ESG factors in sovereign credit ratings," Finance Research Letters, Elsevier, vol. 49(C).
    2. Paula Monteiro, Albertina & Vale, Joana & Leite, Eduardo & Lis, Marcin & Kurowska-Pysz, Joanna, 2022. "The impact of information systems and non-financial information on company success," International Journal of Accounting Information Systems, Elsevier, vol. 45(C).
    3. So Ra Park & Jae Young Jang, 2021. "The Impact of ESG Management on Investment Decision: Institutional Investors’ Perceptions of Country-Specific ESG Criteria," IJFS, MDPI, vol. 9(3), pages 1-27, September.
    4. Azmi, Wajahat & Hassan, M. Kabir & Houston, Reza & Karim, Mohammad Sydul, 2021. "ESG activities and banking performance: International evidence from emerging economies," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 70(C).
    5. Ting-Ting Li & Kai Wang & Toshiyuki Sueyoshi & Derek D. Wang, 2021. "ESG: Research Progress and Future Prospects," Sustainability, MDPI, vol. 13(21), pages 1-28, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    ESG; environmental; social; governance; non-financial reporting; CSR; business sustainability.;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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