Do ESG Endeavors Assist Firms in Achieving Superior Financial Performance? A Case of 100 Best Corporate Citizens

Increasing interest in sustainability performance (environmental, social, and governance pillar [ESGP]) corporate financial (CFP) is noteworthy. However, we do not find any all-inclusive study that employs both individual components of environmental, pillars (ESG) as well the cumulative ESG score on accounting market firms. Furthermore, puts forth “best practices” ESGP-CFP nexus. Therefore, our intends to provide additional empirical evidence this debate by including all three overall employing a unique sample “100 best citizens” United States declared 3BL Media during 2009 2018. For purpose, employ panel vector auto regression (PVAR) allows us overcome methodological challenges faced some earlier studies. The core findings are: (a) for market-based (market-to-book ratio [MTB] Tobin’s Q), results only confirm ESGP–CFP relationship suggest sustained higher commitment environmental pillar, consistent socially responsible conduct, rationalized mechanism sampled firms are perceived value additive players. (b) accounting-based (return equity [ROE] return assets [ROA]), mix CFP–ESGP ROE only. factor error variance decomposition (FEVD) analysis reveals performances quite good predictors future CFP market. These assert actively pursuing endeavors can assist achieving superior performance.