The Impact of ESG Activities on Firm Value: Multi-Level Analysis of Industrial Characteristics

The study attempted to identify how ESG (Environment, Social, Governance) activities affect firm value depending on the industrial environment to which the entity belongs, taking into account industrial characteristic factors that may affect the activities and performance of the entity from a strategic perspective. In order to analyze ESG activities, sustainability report data of South Korea containing ESG information of 87 domestic companies for the period 2002-2020 were collected, and then the effect of ESG according to industrial characteristics on firm value was investigated in depth. The empirical results are as follows. First, it was confirmed that ESG was found to have a positive effect on the firm value. Second, we found that industrial concentration and industrial growth rate, which are industrial characteristic variables, moderate the relationship between ESG and firm value. Through this study, it was possible to identify the importance of the industrial environment surrounding the company in enhancing firm value through ESG activities and to confirm its influence. These results may suggest which ESG strategy directions are needed internally according to the characteristics of the industry in which the company is engaged. We hoped that this study will serve as a stepping stone to broaden the scope of business management research on ESG and to contribute to the field of business strategy, subsequently contributing to the development of ESG in the future.