Impact of ESG on Firm Performance: Moderating Role of Brand Value Mohyuddin Tahir Mahmood , Imran Shahzad

Abstract

The research aims to investigate how ESG influences firm financial performance along with the moderating role of brand value. Data set from Rifinitiv date base related to 334 firms of 18 countries with 6329 observations is analyzed using Stata software. Multiple regression techniques are applied to test the relationship between ESG and financial performance with the moderating role of brand value.

Specifically, we find evidence that ESG has a positive effect on firms' financial performance, but this effect is significantly moderated by brand value. The moderation effect indicates that the positive impact of ESG on financial performance is weaker for highly valued brands.

The findings from this study therefore have major implications for firms, investors, and stakeholders. This research joins the increasing stream of literature on ESG and firm financial performance by further underlining the need to include brand value as a moderating variable, thereby providing practical insights for decision-making in the field of ESG, finance, and corporate sustainability. The insights can also may help the decision-makers in choosing a particular path that best aligns with the goal and values of their organizations.