Research On The Correlation Between ESG Information Disclosure And Corporate Financial Performance

Environment,Social,and Governance(ESG),a crucial component of socially responsible investment and green investment,gives investors the necessary support when making investment decisions by examining a company’s environmental,social,and corporate governance factors and making assessments of the company’s long-term viability and potential investment risks.However,domestic and foreign scholars have not yet reached a unanimous opinion on whether ESG disclosure can have a positive impact on corporate financial performance.Thus,the semiconductor industry—which is crucial to the "double carbon" goal—and its top player,Naura,are chosen for detailed investigation in this research,for specific analysis to explore the relationship between ESG information disclosure and corporate financial performance.In order to examine the current development situation of the semiconductor industry and ESG construction,this study first analyses pertinent domestic and foreign literature and summarizes the prior findings.this paper uses STATA software to investigate the link between ESG disclosure and financial success in the semiconductor sector based on the theories of sustainable development and corporate social responsibility and the multiple regression analysis technique.The study selected semiconductor industry companies that have ESG scores for the years 2018 through 2021.The analysis’ s findings demonstrate a significant positive correlation between the ESG score and the company’s current financial performance,a significant negative correlation between the corporate environment dimension and financial performance,a significant positive correlation between the social dimension and financial performance,and no significant correlation between the corporate governance dimension and financial performance.Both the social dimension and the ESG score significantly positively affect EPS over the medium and long terms,with the degree of this impact tending to rise and subsequently fall.After two periods,the environmental dimension’s negative impact on EPS usually becomes negligible.The effect of corporate governance on EPS is always insignificant.Ultimately,the top company in the semiconductor sector,Naura,is then chosen for a special case study in this paper.Naura has good ESG performance and its ESG and various dimensions scores are consistently better than other companies in the same industry.The company has released CSR reports and disclosed important indicators for four consecutive years.According to data research,Naura’s ESG performance trends are mostly in line with its financial performance trends,and corporate ESG performance is positively connected with corporate financial performance.Naura’s ESG performance helps to boost EPS mostly due to an increase in the social dimension score,and it primarily promotes financial success by steadily growing investment in innovation and public welfare,enhancing employee welfare,and luring more talent to the organization.Based on the above findings,this paper makes the following recommendations from three perspectives: government,companies and stakeholders.The government should continue to promote the construction of ESG,implement pertinent policies,and actively promote the positive impact of ESG information disclosure on corporate financial performance,set unified quantitative indicators,force companies to disclose,strengthen the authenticity,reliability and comparability of corporate ESG information disclosure,and improve the objectivity,readability and understandability of ESG information disclosure.Enterprises,on the other hand,need to emphasize the significance of the "stakeholder" concept and the sustainable development concept,actively participate in the development of the ESG,disclose information related to the ESG,and assure the accuracy of the released information in order to preserve consistency,veracity,and comparability.Stakeholders should choose businesses that have good ESG construction in order to advance ESG construction and create a positive feedback loop.