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The Dynamic Interplay of ESG Performance, Financial Risk, and Corporate Value: A Panel Data Analysis of Emerging Market Firms

Authors: Anirudh Pratap Singh

Published: 2025-05-02 00:46:56.112

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Abstract

This study investigates the complex relationship between Environmental, Social, and Governance (ESG) performance, financial risk, and corporate value within emerging market firms. Utilizing a panel data analysis of a comprehensive dataset spanning multiple years and encompassing a diverse range of companies, we explore how ESG practices influence financial risk profiles and, subsequently, corporate valuation. Our findings reveal a nuanced relationship where strong ESG performance can mitigate certain types of financial risk, ultimately contributing to enhanced corporate value. However, the magnitude and direction of this effect are contingent upon industry-specific factors, regional variations, and the specific ESG pillars considered. The study provides valuable insights for investors, policymakers, and corporate managers seeking to understand the strategic implications of integrating ESG considerations into their decision-making processes, particularly within the context of the unique challenges and opportunities presented by emerging economies. We contribute to the growing body of literature on sustainable finance by providing empirical evidence on the interconnectedness of ESG, risk, and value, offering a more holistic understanding of the factors driving long-term firm performance in the 21st century.

Keywords

ESG Performance, Financial Risk, Corporate Value, Emerging Markets, Panel Data Analysis, Corporate Governance, Sustainable Finance, Firm Performance, Risk Management, Agency Theory

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How to Cite

Anirudh Pratap Singh, (2025-05-02 00:46:56.112). The Dynamic Interplay of ESG Performance, Financial Risk, and Corporate Value: A Panel Data Analysis of Emerging Market Firms. JANOLI International Journal of Economics and Management Science , Volume MejgkunYNoDF1a6qqjpe, Issue 2.

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