IDEAS home Printed from https://ideas.repec.org/a/plo/pone00/0323929.html

Research on the impact of the ESG rating divergence of manufacturing firms on carbon emission intensity

Author

Listed:
  • Jialu Deng
  • Wenhe Lin
  • Jiuzhen Huang
  • Yunying Cai
  • Wenbao Wang

Abstract

The task of reducing carbon emission intensity is difficult for manufacturing firms in China under the national goal of “carbon peaking and carbon neutrality”. Numerous studies have confirmed the inhibitory impact of ESG performance on carbon emission intensity; nevertheless, the significance of ESG rating divergence as a derivative of ESG ratings has been neglected. Therefore, this study selects Chinese A-share listed manufacturing firms from 2011–2022 as a research sample and empirically examines the impact of ESG rating divergence on the carbon emission intensity of Chinese manufacturing firms via a higher-order fixed effects model. The study revealed that (1) ESG rating divergence creates disincentives for manufacturing firms to increase carbon emission intensity; (2) ESG rating divergence leads to an increase in corporate carbon emissions by inhibiting incentives for green innovation; and (3) mitigating financial constraints and enhancing digital transformation in enterprises diminishes the impact of ESG rating divergence on the carbon emissions of manufacturing firms. Furthermore, enterprise digital transformation can exert a moderating influence on both the initial and subsequent stages of the “ESG performance→green innovation→carbon emission intensity” pathway, predominantly in the initial phase. (4) The impact of ESG rating divergence on carbon emission intensity varies depending on the ownership, industry, geography, and level of competitiveness of manufacturing enterprises. The findings not only provide empirical evidence on the feasibility of expanding the standardization of ESG ratings within China’s regulatory framework but also provide useful inspiration for Chinese firms to reduce their carbon emission intensity and achieve sustainable development.

Suggested Citation

  • Jialu Deng & Wenhe Lin & Jiuzhen Huang & Yunying Cai & Wenbao Wang, 2025. "Research on the impact of the ESG rating divergence of manufacturing firms on carbon emission intensity," PLOS ONE, Public Library of Science, vol. 20(6), pages 1-21, June.
    • Handle: RePEc:plo:pone00:0323929
    DOI: 10.1371/journal.pone.0323929
    as

    Download full text from publisher

    File URL: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0323929
    Download Restriction: no
    File URL: https://journals.plos.org/plosone/article/file?id=10.1371/journal.pone.0323929&type=printable
    Download Restriction: no
    File URL: https://libkey.io/10.1371/journal.pone.0323929?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
    ---><---

    References listed on IDEAS

    as
    1. Samuel Drempetic & Christian Klein & Bernhard Zwergel, 2020. "The Influence of Firm Size on the ESG Score: Corporate Sustainability Ratings Under Review," Journal of Business Ethics, Springer, vol. 167(2), pages 333-360, November.
    2. Bradford Cornell, 2021. "ESG preferences, risk and return," European Financial Management, European Financial Management Association, vol. 27(1), pages 12-19, January.
    3. Geng, Yuan & Chen, Jinyu & Liu, Ran, 2024. "ESG rating disagreement and corporate green innovation bubbles: Evidence from Chinese A-share listed firms," International Review of Financial Analysis, Elsevier, vol. 95(PB).
    4. Sun, Zhennan & Du, Qunyang & Du, Anna Min & Li, Zhongyuan & Yang, Tianle, 2024. "The information environment and ecological environment perspectives: Capital market openness and firm ESG rating divergence," Research in International Business and Finance, Elsevier, vol. 71(C).
    5. Chunhua Cai & Yannan Geng & Fufei Yang, 2024. "Senior executive characteristics: Impact on ESG practices and corporate valuation relationship," PLOS ONE, Public Library of Science, vol. 19(7), pages 1-22, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wang, Mingke & Wei, Weixian, 2025. "Modeling the economic and environmental effects of ESG preferences: A general equilibrium approach," Energy Economics, Elsevier, vol. 151(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cheng, Louis T.W. & Cheong, Tsun Se & Wojewodzki, Michal & Chui, David, 2025. "The effect of ESG divergence on the financial performance of Hong Kong-listed firms: An artificial neural network approach," Research in International Business and Finance, Elsevier, vol. 73(PA).
    2. Chang Liu & Zihao Xin, 2024. "Does environmental, social, and governance practice boost corporate human capital inflow in China? From the perspective of stakeholder response," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(4), pages 3251-3273, July.
    3. Long, Huaigang & Chiah, Mardy & Cakici, Nusret & Zaremba, Adam & Bilgin, Mehmet Huseyin, 2024. "ESG investing in good and bad times: An international study," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 91(C).
    4. Chang, Zhenghao & Zhou, Hang & Ruan, Mengyu & Li, Qin, 2025. "When major customers matter: customer concentration and ESG rating disagreement," Journal of Contemporary Accounting and Economics, Elsevier, vol. 21(3).
    5. Tan, Yafei & Zhu, Zhaohui, 2022. "The effect of ESG rating events on corporate green innovation in China: The mediating role of financial constraints and managers' environmental awareness," Technology in Society, Elsevier, vol. 68(C).
    6. Thomas Cauthorn & Christian Klein & Leonard Remme & Bernhard Zwergel, 2023. "Portfolio benefits of taxonomy orientated and renewable European electric utilities," Journal of Asset Management, Palgrave Macmillan, vol. 24(7), pages 558-571, December.
    7. Caterina Lucarelli & Sabrina Severini, 2024. "Anatomy of the chimera: Environmental, Social, and Governance ratings beyond the myth," Business Strategy and the Environment, Wiley Blackwell, vol. 33(5), pages 4198-4217, July.
    8. Benuzzi, Matteo & Bax, Karoline & Paterlini, Sandra & Taufer, Emanuele, 2025. "Chasing ESG performance: How methodologies shape outcomes," International Review of Financial Analysis, Elsevier, vol. 104(PA).
    9. Niu, Bingcheng, 2024. "Government environmental protection expenditure and national ESG performance: Global evidence," Innovation and Green Development, Elsevier, vol. 3(2).
    10. Jian Zhou & Xiaodong Lei & Jianglong Yu, 2024. "ESG rating divergence and corporate green innovation," Business Strategy and the Environment, Wiley Blackwell, vol. 33(4), pages 2911-2930, May.
    11. Si, Deng-Kui & Zhou, Fu-You & Li, Xiao-Lin & Kong, Dongmin, 2025. "The effect of financial marketization on the nexus between ESG rating uncertainty and corporate innovation," International Review of Financial Analysis, Elsevier, vol. 106(C).
    12. Wang, Haijun & Jiao, Shuaipeng & Ma, Chao, 2024. "The impact of ESG responsibility performance on corporate resilience," International Review of Economics & Finance, Elsevier, vol. 93(PB), pages 1115-1129.
    13. Wang, Jianli & Xiao, Xiao & Dong, Minghua & Li, Jingyuan, 2025. "Does ESG rating disagreement discourage corporate green innovation? Evidence from China," Research in International Business and Finance, Elsevier, vol. 80(C).
    14. Sun, Guanglin & Yan, Zian & Gong, Zejun & Li, Mengding, 2025. "The impact of ESG rating divergence on stock price crash risk," International Review of Financial Analysis, Elsevier, vol. 102(C).
    15. Oehler, Andreas & Neuss, Charlotte, 2025. "ESG disclosure vs. ESG ratings: Consistent information value?," International Review of Financial Analysis, Elsevier, vol. 107(C).
    16. Arru Brunella & Delrio Federico & Furesi Roberto & Pulina Pietro & Fabio Albino Madau, 2025. "Role of environmental, social and governance disclosure in business profitability and cost of debt: An analysis of small Southern Italian agri‐food businesses," Agribusiness, John Wiley & Sons, Ltd., vol. 41(3), pages 856-895, July.
    17. Spira, Robin, 2024. "How does ESG rating disagreement influence analyst forecast dispersion?," Junior Management Science (JUMS), Junior Management Science e. V., vol. 9(3), pages 1769-1804.
    18. Wang, Mingke & Wei, Weixian, 2025. "Modeling the economic and environmental effects of ESG preferences: A general equilibrium approach," Energy Economics, Elsevier, vol. 151(C).
    19. Scholz, Robert, 2023. "Unternehmensmitbestimmung und die sozialökologische Transformation: Zusammenhang zwischen Mitbestimmungsindex und ESG-Kriterien in börsennotierten Unternehmen," Mitbestimmungsreport 79, Hans-Böckler-Stiftung, Düsseldorf.
    20. Rega, Federico Giovanni & Russo, Simona & Salerno, Dario, 2025. "Disentangling the S and the G in the European banking industry: The role of climate risk and opportunity awareness," Research in International Business and Finance, Elsevier, vol. 77(PB).

    More about this item

    Statistics

    Access and download statistics

    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:plo:pone00:0323929. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: plosone (email available below). General contact details of provider: https://journals.plos.org/plosone/ .

    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.