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Equity pledge of controlling shareholders and corporate ESG disclosure

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Listed:
  • Huang, Xiaohui
  • Zhao, Xinlu
  • Lyu, Chan

Abstract

This work studies the impact of equity pledge by controlling shareholders on the quality of corporate ESG disclosures and the mechanism through which digital transformation plays a role, utilizing data from A-share companies listed in Shanghai and Shenzhen between 2013 and 2022. Empirical findings reveal that the overall quality of ESG disclosure is considerably reduced by the presence of equity pledges of the controlling shareholders, particularly in heavily polluting firms, non-ISO-certified firms, and those in highly competitive industries. A detailed analysis indicates that equity pledges impede digital transformation, further reducing ESG disclosure quality. These findings provide valuable guidance for enterprises to enhance their ESG information disclosure system and digital transformation towards sustainable development of the capital market.

Suggested Citation

  • Huang, Xiaohui & Zhao, Xinlu & Lyu, Chan, 2025. "Equity pledge of controlling shareholders and corporate ESG disclosure," Finance Research Letters, Elsevier, vol. 85(PE).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pe:s1544612325015284
    DOI: 10.1016/j.frl.2025.108274
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    References listed on IDEAS

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