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The Analysis of the Effect for Governance on the Relationship between ESG and Corporate Value
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ESG의 기업가치 관련성에 대한 지배구조의 영향 분석

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Type
Academic journal
Author
LEE SEUNGTAE (동아대학교)
Journal
신용보증기금 중소기업금융연구 중소기업금융연구 제42권 제3호 KCI Accredited Journals
Published
2022.9
Pages
3 - 28 (26page)

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The Analysis of the Effect for Governance on the Relationship between ESG and Corporate Value
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Recently, interest in ESG has rising worldwide as non-financial factors such as Environmental, Social, and Governance. Investors are using ESG as a basis for making corporate investment decisions. If Investors invest in a firm with a high ESG rating, increase the return on investment and reduce investment risk. This study not only examines the relationship between corporate ESG components and corporate value, but also expands the study to whether Governance works as a factor that reinforces ESG. We study non-financially listed companies that can use ESG evaluation ratings from the Korea Corporate Governance Service (KCGS). The analysis period is 3 years from 2019 to 2021. The empirical results of this study are as follows. First, it was found that the higher the grade of society and governance, the higher the corporate value. ESG integrated grade also showed that the higher the grade, the higher the corporate value. The larger company, the greater the effect. Second, we confirmed that governance has a effect that further strengthens the relationship between ESG and corporate value. Firm with a more improved decision-making system is making efforts to prevent ESG risk, and as a result of this effort, Firm value also increases.

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