Research On The Impact Of Institutional Investors Shareholding On The ESG Rating Of Listed Companies

With the rapid development of domestic and foreign economies,the contradiction between the pursuit of profit maximization and the fulfillment of social interests has become more and more obvious,such as market monopoly and environmental pollution.Governments and social organizations in various countries have called on enterprises to strengthen their sense of social responsibility,and actively take into account the interests of the public,community maintenance,and green environmental protection while pursuing the maximization of shareholders’ interests,so as to provide a good market environment for sustainable social development.Since the 18th National Congress of the Communist Party of China,China has been fighting corruption with an iron fist,controlling pollution and protecting the environment,and poverty alleviation and promoting people’s livelihood.Now,it has set the "3060" dual-carbon goal responsibly.It can be called the country that promotes ESG the most in the world..In the capital market,ESG has become an important consideration in investment decisions;in the commercial field,ESG has gradually become the core element of business management.At present,the ESG industry has covered three major themes:information disclosure,evaluation and rating,and investment and financing.Among them,ESG information disclosure,as the basis and premise,is the most important basis for displaying and judging the ESG risk level and potential opportunities of listed companies.Since 2017,due to the impact of the economic downturn and the economic and trade frictions between China and the United States,China’s stock market has experienced a continuous decline in volatility,which has caused serious losses to investors,especially individual investors.big impact.Individual investors lack the ability and awareness of risk-taking in the market;due to lack of investment experience,when the stock market falls,they cannot make correct decisions in a timely manner,which makes their investment risks more serious and suffers a serious blow.On the other hand,the retail transaction volume of Chinese stocks exceeds 80%,while that of individual investors in the United States is only 6%,which shows that China’s stock market is in a very fragmented state,and its investor composition is seriously unbalanced.The healthy development of the financial system is not good."De-retail" has become a problem that the current domestic capital market must face.At the same time,the number and shareholding ratio of institutional investors is also expanding,and the types of investment companies are becoming more and more diverse.Implementing effective supervision of investee companies is conducive to enhancing the company’s long-term interests,protecting small and medium shareholders,and regulating the capital market.In this context,this study selects the data of listed companies in Shenzhen and Shanghai in 2018 and 2019 as the research object,adopts normative research,literature review,empirical analysis and other research methods,and uses signal transmission theory and resource dependence theory.,principal-agent theory,corporate governance theory and other theories,and adopt research methods such as probitregression analysis,descriptive sampling analysis and robustness analysis,and incorporate the profitability and asset profitability of listed companies into the research system.The impact of stocks on the ESG rating of listed companies and a multi-dimensional verification analysis.The following conclusions are drawn:(1)The impact of institutional investment holdings on the ESG rating of listed companies is positively correlated,and the increase in the shareholding ratio of institutional investors can significantly improve the ESG rating of listed companies.(2)The interaction effect between institutional investors and the profitability of listed companies is significant.Improving the profitability of listed companies can promote the increase of institutional investment shareholding ratios,which will improve the ESG rating of listed companies.(3)The interaction effect between institutional investors and the return on assets of listed companies is significant.Increasing the return on assets of listed companies can promote the increase of institutional investment shareholding ratios,which in turn will improve the ESG rating of listed companies.Therefore,increasing the shareholding ratio of institutional investors will help the regulatory authorities to comprehensively assess the level of corporate governance,improve the construction of the capital market,and protect the investment of small and medium investors.