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Environmental, Social, and Governance (ESG) Dynamics in the Energy Sector: Strategic Approaches for Sustainable Development

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  • Mustafa Yucel

    (Department of Business Administration, Kastamonu University, Kastamonu 37150, Türkiye)

  • Sevgi Yucel

    (Department of Economics, Kastamonu University, Kastamonu 37150, Türkiye)

Abstract

ESG metrics have become increasingly important in evaluating corporate sustainability and meeting regulatory expectations. Thus, it is essential to explore these elements for a clearer understanding. This study examined the environmental (E), social (S), and governance (G) scores across various sub-sectors of the energy industry. Using systems thinking and creating shared value (CSV) approaches, the research investigated whether ESG performance varies significantly among the sub-sectors and how changes in one pillar might influence the others. Data from 576 companies in the Thomson Reuters EIKON database were analyzed using ANOVA, correlation, and multiple regression. The results revealed distinct differences in the ESG scores among sub-sectors, with environmental and social practices often reinforcing each other. However, governance showed a weaker influence, highlighting the need for further research on governance frameworks to clarify the underlying reasons and to integrate better with other ESG pillars. The research has specific implications for strategic management and provided recommendations for further studies.

Suggested Citation

  • Mustafa Yucel & Sevgi Yucel, 2024. "Environmental, Social, and Governance (ESG) Dynamics in the Energy Sector: Strategic Approaches for Sustainable Development," Energies, MDPI, vol. 17(24), pages 1-19, December.
    • Handle: RePEc:gam:jeners:v:17:y:2024:i:24:p:6291-:d:1543082
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