ESG Synergy and Financial Performance: an Investigation into SET Companies (2020-2022)
Keywords:
Environmental, Social, Governance, ESG, SET, ROA, ROE, Net Profit MarginAbstract
It has been a growing awareness of the importance of ESG practices in business enterprises. Sustainable operations and ethical business practices are critical as companies navigate a world characterized by tightening international rules and regulations. Thus, this study aims to explore the relationship between ESG and financial performance across various industries on SET companies. The data from this research obtained from the SETSMART database, SET’s Thailand Sustainability Investment reports (THSI), and SET’s financial performance for 1,528 SET companies over the year 2020 to 2022. The research employed multivariable empirical regression, correlation analysis, and descriptive approaches. Three regression models were used to find the relationship between ESG performance and ROA, ROE, and the Net Proft Margin, respectively. The results revealed a significant increase in environmental, social, and governance performance, which differs across sectors. The multivariable regression results demonstrated a positive significant relationship between environmental performance and the ROE and ROA. In addition, the study showed a positive significant relationship between the Net Proft Margin and government performance. However, there is no significant relationship between social performance and other financial performance.
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