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The impact of corporate financialization on ESG performance: A perspective based on executive incentives

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  • Xing, Yafei
  • Wang, Junwei
  • Liu, Zheng
  • Xiao, Daibo

Abstract

This study utilizes data from publicly listed companies between 2009 and 2022 as a sample set to investigate how corporate financialization affects corporate ESG performance. The empirical findings suggest that corporate financialization positively contributes to enhancing ESG performance. Executive compensation structures emerge as a moderating variable in the interplay between corporate financialization and ESG performance, with this moderation exhibiting differential impacts on state-owned versus non-state-owned enterprises. Furthermore, the degree of corporate financialization influences ESG performance, revealing a threshold effect as the company's debt-to-asset ratio rises.

Suggested Citation

  • Xing, Yafei & Wang, Junwei & Liu, Zheng & Xiao, Daibo, 2025. "The impact of corporate financialization on ESG performance: A perspective based on executive incentives," Finance Research Letters, Elsevier, vol. 76(C).
    • Handle: RePEc:eee:finlet:v:76:y:2025:i:c:s1544612325001989
    DOI: 10.1016/j.frl.2025.106934
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    References listed on IDEAS

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