IDEAS home Printed from https://ideas.repec.org/a/eee/joecas/v31y2025ics1703494925000131.html
   My bibliography  Save this article

Energy uncertainty and Firm Performance: Does ESG matter?

Author

Listed:
  • Barman, Siddhartha
  • Mahakud, Jitendra

Abstract

This study investigates the influence of ESG performance on the relationship between firm performance and global energy uncertainty (EUI). Our primary objective is to examine the manner in which the environmental, social, and governance (ESG) factors influences the relationship between firm performance and EUI. This objective was accomplished by employing a comprehensive dataset that encompassed 50 nations, and spanned eight years (2014–2021). The results reveal that EUI has a detrimental effect on the performance of firms, as the uncertainties induced by EUI foster a culture of risk aversion, which in turn causes firms to postpone their investment in long-term projects. In contrast, the analysis emphasises a positive correlation between ESG and EUI-firm performance relationship, suggesting that firms with robust ESG performance are more likely to invest due to improved reputation, cost reduction, and sustainable market access even in times of energy related uncertainty such as oil price volatility and other energy price surges. The novelty of this research lies in its holistic approach to examining the interconnected dynamics between EUI and firm performance, and the moderating influence of ESG. The findings offer practical guidance for investors and corporate managers.

Suggested Citation

  • Barman, Siddhartha & Mahakud, Jitendra, 2025. "Energy uncertainty and Firm Performance: Does ESG matter?," The Journal of Economic Asymmetries, Elsevier, vol. 31(C).
    • Handle: RePEc:eee:joecas:v:31:y:2025:i:c:s1703494925000131
    DOI: 10.1016/j.jeca.2025.e00413
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1703494925000131
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jeca.2025.e00413?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    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:eee:joecas:v:31:y:2025:i:c:s1703494925000131. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/the-journal-of-economic-asymmetries/ .

    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.