Political connection and corporate ESG performance: Evidence from China

Authors

DOI:

https://doi.org/10.18559/ebr.2026.1.2293

Keywords:

ESG performance, political connection, media monitoring, financing constraints

Abstract

ESG has attracted widespread attention in China’s capital markets. This study investigates the impact of corporate executives’ political connections on firms’ ESG performance in China. Using panel data from A-share listed companies between 2009 and 2022, this study empirically tests whether politically connected executives influence ESG ratings. The results show a significant positive association between political connections and ESG scores. Mechanism analysis reveals that such connections improve ESG performance by enhancing media scrutiny, alleviating financing constraints, and increasing access to government subsidies. To address endogeneity concerns, we employ Two-Stage Least Squares (2SLS) regression, confirming the robustness of the findings. These results highlight the role of political capital in promoting sustainable corporate practices.

JEL Classification

Corporate Finance and Governance (G3)
Business Economics (M21)
Environment and Development • Environment and Trade • Sustainability • Environmental Accounts and Accounting • Environmental Equity • Population Growth (Q56)

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Published

2026-03-26

Issue

Vol. 12 No. 1 (2026): in-press

Section

Research articles

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Copyright (c) 2026 Congming Ding, Xuezhenzi Hu

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This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite

Ding, C., & Hu, X. (2026). Political connection and corporate ESG performance: Evidence from China. Economics and Business Review, 12(1). https://doi.org/10.18559/ebr.2026.1.2293

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