Does ESG always improve corporate performance? Evidence from firm life cycle perspective

In this study, drawing on firm life cycle theory, we focus the corporate performance of Environmental, Social, and Governance (ESG) engagement via financial stress consider moderate effect transparency, slack, environmental uncertainty. The industry-year fixed effects panel regression analysis is executed based data including 11,742 firm-year observations for 1,486 Chinese A-share listed companies from 2010 to 2020. results show that ESG can significantly improve at all stages, especially when in growth stage. Moreover, mechanism shows risk mediates relation between corporates maturity stages. association more pronounced information disclosure quality high. slack moderates undermine Similarly, decline stages corporate, uncertainty undermines performance. Besides offering scientific evidence role ratings relieving pressure promoting also inform regulators and/or investors benefit engaging sustainability transition, which has implications both success regulatory regime advancement long-term investment philosophy.