IDEAS home Printed from https://ideas.repec.org/a/bla/asiapr/v21y2026i1p24-38.html

Inclusive Wealth and ESG Practices: Financial Impacts in a Global Context

Author

Listed:
  • Jun Xie
  • Kenichi Yoshida
  • Shuning Chen
  • Alexander Ryota Keeley
  • Hidemichi Fujii
  • Shunsuke Managi

Abstract

This study explores the relationship between ESG practices and corporate financial outcomes across 38 economies from 2013 to 2022, with a focus on the moderating role of regional sustainability, proxied by inclusive wealth. The findings reveal significant disparities in ESG performance, with European firms leading globally while those in Asia, particularly Southeast Asia, lag in ESG scores but exhibit stronger financial benefits from ESG engagement. Inclusive wealth plays a critical moderating role in the ESG‐finance relationship, serving as key regional sustainability indicators. Specifically, human and natural capital positively moderate the financial impact of corporate environmental efforts. These results suggest that inclusive wealth captures structural conditions that shape ESG effectiveness and can inform region‐specific sustainability strategies. This study highlights the importance of integrating long‐term, multidimensional sustainability indicators into ESG evaluation frameworks to better align corporate strategies with economic and institutional contexts, thereby enhancing both firm performance and broader sustainable development outcomes.

Suggested Citation

  • Jun Xie & Kenichi Yoshida & Shuning Chen & Alexander Ryota Keeley & Hidemichi Fujii & Shunsuke Managi, 2026. "Inclusive Wealth and ESG Practices: Financial Impacts in a Global Context," Asian Economic Policy Review, Japan Center for Economic Research, vol. 21(1), pages 24-38, January.
    • Handle: RePEc:bla:asiapr:v:21:y:2026:i:1:p:24-38
    DOI: 10.1111/aepr.70006
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/aepr.70006
    Download Restriction: no
    File URL: https://libkey.io/10.1111/aepr.70006?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Antonio D'Amato & Camilla Falivena, 2020. "Corporate social responsibility and firm value: Do firm size and age matter? Empirical evidence from European listed companies," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(2), pages 909-924, March.
    2. Masayuki Sato & Kenta Tanaka & Shunsuke Managi, 2018. "Inclusive wealth, total factor productivity, and sustainability: an empirical analysis," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 20(4), pages 741-757, October.
    3. Alexandre Garel & Arthur Petit-Romec, 2021. "Investor rewards to environmental responsibility: Evidence from the COVID-19 crisis," Post-Print hal-03204216, HAL.
    4. ZHANG, Jing & ZI, Shuang, 2021. "Socially responsible investment and firm value: The role of institutions," Finance Research Letters, Elsevier, vol. 41(C).
    5. Garel, Alexandre & Petit-Romec, Arthur, 2021. "Investor rewards to environmental responsibility: Evidence from the COVID-19 crisis," Journal of Corporate Finance, Elsevier, vol. 68(C).
    6. Alex Edmans & Darcy Pu & Chendi Zhang & Lucius Li, 2024. "Employee Satisfaction, Labor Market Flexibility, and Stock Returns Around the World," Management Science, INFORMS, vol. 70(7), pages 4357-4380, July.
    7. Karl V. Lins & Henri Servaes & Ane Tamayo, 2017. "Social Capital, Trust, and Firm Performance: The Value of Corporate Social Responsibility during the Financial Crisis," Journal of Finance, American Finance Association, vol. 72(4), pages 1785-1824, August.
    8. Abagail McWilliams & Donald Siegel, 2000. "Corporate social responsibility and financial performance: correlation or misspecification?," Strategic Management Journal, Wiley Blackwell, vol. 21(5), pages 603-609, May.
    9. Edmans, Alex, 2011. "Does the stock market fully value intangibles? Employee satisfaction and equity prices," Journal of Financial Economics, Elsevier, vol. 101(3), pages 621-640, September.
    10. Rui Albuquerque & Yrjo Koskinen & Shuai Yang & Chendi Zhang, 2020. "Resiliency of Environmental and Social Stocks: An Analysis of the Exogenous COVID-19 Market Crash," The Review of Corporate Finance Studies, Society for Financial Studies, vol. 9(3), pages 593-621.
    11. Rui Albuquerque & Yrjö Koskinen & Chendi Zhang, 2019. "Corporate Social Responsibility and Firm Risk: Theory and Empirical Evidence," Management Science, INFORMS, vol. 65(10), pages 4451-4469, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yuxia Zou, 2026. "Comment on “Inclusive Wealth and ESG Practices: Financial Impacts in a Global Context”," Asian Economic Policy Review, Japan Center for Economic Research, vol. 21(1), pages 39-40, January.
    2. Caroline Flammer & Takatoshi Ito & Kazumasa Iwata & Colin McKenzie & Shujiro Urata, 2026. "Sustainable Finance in Asia: Editors' Overview," Asian Economic Policy Review, Japan Center for Economic Research, vol. 21(1), pages 5-13, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhang, Ning & Zhang, Yue & Zong, Zhe, 2023. "Fund ESG performance and downside risk: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 86(C).
    2. Kara, Alper & Ongena, Steven & Yildiz, Yilmaz, 2024. "Does being a responsible bank pay off? Evidence from the COVID-19 pandemic," Journal of Financial Stability, Elsevier, vol. 74(C).
    3. Wu, Zhenshu & Pownall, Rachel & Shih, Yi-Cheng & Zhang, Chendi, 2025. "State ownership and the value of sustainability: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 102(C).
    4. Ouyang, Xiaoling & Yang, Yuchuan & Du, Kerui, 2024. "Impact of CSR on stock return resilience during the 2020 public health emergency: Evidence from the Chinese financial market," International Review of Financial Analysis, Elsevier, vol. 96(PB).
    5. Giovanni Cardillo & Ennio Bendinelli & Giuseppe Torluccio, 2023. "COVID‐19, ESG investing, and the resilience of more sustainable stocks: Evidence from European firms," Business Strategy and the Environment, Wiley Blackwell, vol. 32(1), pages 602-623, January.
    6. Yi, Yuyang & Zhang, Zongyi & Xiang, Cheng, 2022. "The value of CSR during the COVID-19 crisis: Evidence from Chinese firms," Pacific-Basin Finance Journal, Elsevier, vol. 74(C).
    7. Qian, Kun & Shi, Bingjie & Song, Yunling & Wu, Hao, 2023. "ESG performance and loan contracting in an emerging market," Pacific-Basin Finance Journal, Elsevier, vol. 78(C).
    8. Andreou, Panayiotis C. & Lambertides, Neophytos & Trigeorgis, Lenos & Tuneshev, Ruslan, 2025. "Customer orientation and stock resilience during adversity periods," Journal of Corporate Finance, Elsevier, vol. 93(C).
    9. Chava, Sudheer & Kim, Jeong Ho (John) & Lee, Jaemin, 2025. "Risk, return, and environmental and social ratings," Journal of Corporate Finance, Elsevier, vol. 92(C).
    10. Imen Khanchel & Naima Lassoued & Rym Gargoury, 2023. "CSR and firm value: is CSR valuable during the COVID 19 crisis in the French market?," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 27(2), pages 575-601, June.
    11. Angelidis, Timotheos & Michairinas, Athanasios & Sakkas, Athanasios, 2024. "World ESG performance and economic activity," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 93(C).
    12. Peng, Daoju & Colak, Gonul & Shen, Jianfu, 2023. "Lean against the wind: The effect of policy uncertainty on a firm's corporate social responsibility strategy," Journal of Corporate Finance, Elsevier, vol. 79(C).
    13. Shackleton, Mark & Yan, Jiali & Yao, Yaqiong, 2022. "What drives a firm's ES performance? Evidence from stock returns," Journal of Banking & Finance, Elsevier, vol. 136(C).
    14. Alexandre Garel & Arthur Petit-Romec, 2021. "Investor rewards to environmental responsibility: Evidence from the COVID-19 crisis," Post-Print hal-03204216, HAL.
    15. Eisenkopf, Jana & Juranek, Steffen & Walz, Uwe, 2021. "Responsible investment and stock market shocks: Short-term insurance and persistent outperformance post-crisis?," SAFE Working Paper Series 329, Leibniz Institute for Financial Research SAFE.
    16. Yang, Junhua & Agyei, Samuel Kwaku & Bossman, Ahmed & Gubareva, Mariya & Marfo-Yiadom, Edward, 2024. "Energy, metals, market uncertainties, and ESG stocks: Analysing predictability and safe havens," The North American Journal of Economics and Finance, Elsevier, vol. 69(PB).
    17. Mansouri, Sasan & Momtaz, Paul P., 2022. "Financing sustainable entrepreneurship: ESG measurement, valuation, and performance," Journal of Business Venturing, Elsevier, vol. 37(6).
    18. Luo, Di, 2022. "ESG, liquidity, and stock returns," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 78(C).
    19. Khaled Alsaifi & Marwa Elnahass & Abdullah M. Al-Awadhi & Aly Salama, 2022. "Carbon disclosure and firm risk: evidence from the UK corporate responses to climate change," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(3), pages 505-526, September.
    20. Walid Ben‐Amar & Breeda Comyns & Isabelle Martinez, 2024. "Firm commitments on climate change: Effects of science‐based targets on financial outcomes during the COVID‐19 crisis," Business Strategy and the Environment, Wiley Blackwell, vol. 33(8), pages 7768-7787, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:asiapr:v:21:y:2026:i:1:p:24-38. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/jcerrjp.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.