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The Impact of ESG Investments on Labor Productivity: Mechanisms and Long-Term Effects

Author

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  • Anika Petkova

    (University of National and World Economy, Sofia, Bulgaria)

Abstract

ESG investments, as an essential component of sustainable finance, exert both direct and indirect effects on labor productivity. This influence materializes through the adoption of energy-efficient technologies and the optimization of resource use, which generate economies of scale and enhance total factor productivity. The social dimensions of ESG investing—improved working conditions, professional training, and a safe work environment—strengthen employee motivation and contribute to higher labor efficiency. Digitalization, automation, and the application of artificial intelligence further amplify the positive impact of sustainable investments. Owing to these advantages, ESG investing is increasing recognized as a key mechanism for improving labor productivity and fostering long-term sustainable economic growth.

Suggested Citation

  • Anika Petkova, 2025. "The Impact of ESG Investments on Labor Productivity: Mechanisms and Long-Term Effects," Nauchni trudove, University of National and World Economy, Sofia, Bulgaria, issue 5, pages 99-110, December.
    • Handle: RePEc:nwe:natrud:y:2025:i:5:p:99-110
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    Keywords

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    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • 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

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