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Internationalization's Function in Reducing the Effect of ESG Disclosure on Financial Results: Case of Companies in the United Kingdom

Author

Listed:
  • Adel Necib
  • Anis Jarboui
  • Malek Elweeremmi

Abstract

Purpose: This study aims to investigate how disclosures on social, environmental, and governance practices affect the financial performance of non-financial companies listed on the London Stock Exchange's FTSE 100 from 2015 to 2024. Design/Methodology/Approach: To clarify the relationships between the variables, we used regression analysis on moderated data and regression on subgroups. Findings: The results reveal an unexpected finding: while the indicator of social responsibility has no discernible effect on the financial performance of businesses, the indicators of environmental responsibility and disclosure of governance practices cause a decline in business financial performance. It is possible to view the expenses associated with ESG practices as a waste of company resources, a misallocation, or, conversely, as an overinvestment. Practical Implications: Businesses that engage in internationalisation may see a decline in performance as a result of environmental responsibility disclosure and governance practices. In order to ensure the sustainability of environmental, social, and governance activities over the long term, managers must consistently provide higher and better financial performance. Originality/Value:

Suggested Citation

  • Adel Necib & Anis Jarboui & Malek Elweeremmi, 2025. "Internationalization's Function in Reducing the Effect of ESG Disclosure on Financial Results: Case of Companies in the United Kingdom," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(3), pages 76-97.
    • Handle: RePEc:ers:ijebaa:v:xiii:y:2025:i:3:p:76-97
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • 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
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

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