Skip to main navigation menu Skip to main content Skip to site footer
FrancoAngeli Journals

Regular Articles

Early View

Environmental, Social, and Governance initiatives important for the economic performance of food and beverage companies in developed and emerging countries

DOI
https://doi.org/10.3280/ecag2025oa18400
Submitted
agosto 29, 2024
Published
2025-11-27

Abstract

This study analyzes the impact of environmental, social, and governance (ESG) initiatives on the financial and economic performance of food and beverage companies operating in developed and emerging markets. The research seeks to clarify the role of ESG practices in corporate profitability and market valuation, addressing the gap in empirical studies that link firm-level ESG indicators to performance metrics. A panel data regression analysis was conducted on 159 companies from 30 countries between 2017 and 2021, using Bloomberg ESG scores and financial indicators. Results indicate that social and governance practices have a positive influence on financial performance, while environmental initiatives exhibit a negative impact. The study highlights the need for cautious evaluation of environmental investments due to their potential adverse financial effects. The research contributes to the ongoing ESG discourse by providing insights for businesses, policymakers, and investors regarding sustainable corporate practices. Future studies should explore sector-specific ESG impacts and broader datasets to refine these findings.

References

  1. Aich, S., Thakur, A., Nanda, D., Tripathy, S., & Kim, H. C. (2021). Factors Affecting ESG towards Impact on Investment: A Structural Approach. Sustainability, 13(19), 10868. Doi: 10.3390/SU131910868.
  2. Al Amosh, H., & Khatib, S. F. A. (2023). ESG performance in the time of the COVID-19 pandemic: cross-country evidence. Environmental Science and Pollution Research, 30(14), 39978-39993. Doi: 10.1007/s11356-022-25050-w.
  3. Alshehhi, A., Nobanee, H., & Khare, N. (2018). The Impact of Sustainability Practices on Corporate Financial Performance: Literature Trends and Future Research Potential. Sustainability, 10(2), 494. Doi: 10.3390/su10020494.
  4. Barson, Z., Ofori, K. S., Junior, P. O., Boakye, K. G., & Ampong, G. O. A. (2024). Time-varying Connectedness Between ESG Stocks and BRVM Traditional Stocks. Journal of Emerging Market Finance, 23(3), 306-335. Doi: 10.1177/09726527241233920.
  5. BLACKROCK (2018). A Sense of Purpose. Annual Letter to CEOs. -- https://aips.online/wp-content/uploads/2018/04/Larry-Fink-letter-to-CEOs-2018-BlackRock.pdf.
  6. BLACKROCK (2020). Investment Stewardship Annual Report. -- https://www.blackrock.com/corporate/literature/publication/blk-annual-stewardship-reportexec-summary-2020.pdf.
  7. Boumlik, Z., Oulhadj, B., & Colot, O. (2023). The Effect of the COVID-19 Pandemic on Corporate Dividend Policy of Moroccan Listed Firms. Journal of Risk and Financial Management, 16(8). Doi: 10.3390/jrfm16080350.
  8. Broadstock, D. C., Chan, K., Cheng, L. T. W., & Wang, X. (2021). The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China. Finance Research Letters, 38, 101716. Doi: 10.1016/J.FRL.2020.101716.
  9. Buitendag, N., Fortuin, G. S., & De Laan, A. (2017). Firm characteristics and excellence in integrated reporting. South African Journal of Economic and Management Sciences, 20(1). Doi: 10.4102/sajems.v20i1.1307.
  10. Chelawat, H., & Trivedi, I. V. (2016). The business value of ESG performance: the Indian context. Asian Journal of Business Ethics, 5(1-2), 195-210. Doi: 10.1007/s13520-016-0064-4.
  11. Chen, S.-H., Hsu, H.-C., & Lin, S.-T. (2025). The Joint Effects of Firm’s Globalization and ESG Rating on Financial Performance: Evidence from Food Industry in Taiwan. Sustainability Switzerland, 17(6). Doi: 10.3390/su17062580.
  12. Chouaibi, S., Chouaibi, J., & Rossi, M. (2022). ESG and corporate financial performance: the mediating role of green innovation: UK common law versus Germany civil law. EuroMed Journal of Business, 17(1), 46-71. Doi: 10.1108/EMJB-09-2020-0101.
  13. Chuang, S.-H., & Lin, H.-N. (2017). Performance implications of information value offering in e-service systems: Examining the resource-based perspective and innovation strategy. Journal of Strategic Information Systems, 26(1). Doi: 10.1016/j.jsis.2016.09.001.
  14. Costantini, V., Crespi, F., Marin, G., & Paglialunga, E. (2017). Eco-innovation, sustainable supply chains and environmental performance in European industries. Journal of Cleaner Production, 155, 141-154. Doi: 10.1016/j.jclepro.2016.09.038.
  15. Dayanandan, A., Donker, H., & Kuntluru, S. (2024). IFRS and ESG Disclosure in Indian Corporate Sector. Journal of Emerging Market Finance, 23(2), 143-169. Doi: 10.1177/09726527231197328.
  16. Dunn, J., Fitzgibbons, S., & Pomorski, L. (2018). Assessing risk through environmental, social and governance exposures. Journal of Investment Management, 16(1), 4-17.
  17. Forte, H. C., Silva, L. K. S., & Abreu, M. C. S. de. (2021). Efeito da estrutura do conselho de administração na evidenciação de práticas ambientais e sociais em empresas brasileiras. Revista Universo Contábil, 16(1), 119. Doi: 10.4270/ruc.2020106.
  18. Friede, G., Busch, T., & Bassen, A. (2015). ESG and financial performance: aggregated evidence from more than 2000 empirical studies. Journal of Sustainable Finance & Investment, 5(4), 210-233. Doi: 10.1080/20430795.2015.1118917.
  19. Gangi, F., D’Angelo, E., Daniele, L. M., & Varrone, N. (2020). The impact of corporate governance on social and environmental engagement: what effect on firm performance in the food industry?. British Food Journal, 123(2), 610-626. Doi: 10.1108/BFJ-02-2020-0140.
  20. Gega, M., Höhler, J., Bijman, J., & Oude Lansink, A. (2025). Firm ownership and ESG performance in European agri-food companies: The mediating effect of risktaking and time horizon. Corporate Social Responsibility and Environmental Management, 32(1), 1161-1181. Doi: 10.1002/csr.3008.
  21. Gosain, N., Kashiramka, S., & Chaudhry, N. (2025). Signaling vs. agency theory: What drives dividends of promoter-owned firms during a crisis?. Research in International Business and Finance, 73. Doi: 10.1016/j.ribaf.2024.102590.
  22. Henisz, W., Koller, T., & Nuttal, R. (2019, November). ESG framework | McKinsey. McKinsey Quartely, 1-12. -- https://www.mckinsey.com/capabilities/strategy-andcorporate-finance/our-insights/five-ways-that-esg-creates-value#/.
  23. Iatridis, G. E. (2013). Environmental disclosure quality: Evidence on environmental performance, corporate governance and value relevance. Emerging Markets Review, 14, 55-75. Doi: 10.1016/j.ememar.2012.11.003.
  24. Ismail, A. M., Adnan, Z. H. M., Fahmi, F. M., Darus, F., & Clark, C. (2019). Board Capabilities and the Mediating Roles of Absorptive Capacity on Environmental Social and Governance (ESG) Practices. International Journal of Financial Research, 10(3), 11. Doi: 10.5430/ijfr.v10n3p11.
  25. Khanchel, I., & Lassoued, N. (2022). ESG Disclosure and the Cost of Capital: Is There a Ratcheting Effect over Time?. Sustainability, 14(15), 9237. Doi: 10.3390/su14159237.
  26. KPMG (2020). The time has come: The KPMG Survey of Sustainability Reporting 2020. -- https://assets.kpmg.com/content/dam/kpmg/be/pdf/2020/12/The_Time_Has_Come_KPMG_Survey_of_Sustainability_Reporting_2020.pdf.
  27. Lanzalonga, F., Oppioli, M., Calandra, D., & Secinaro, S. (2025). The impact of ESG performance on intangible assets and intellectual capital in the food and beverage industry. Management Decision, 63(2), 423-442. Doi: 10.1108/MD-09-2023-1664.
  28. Liu, L., Zhou, X., & Xu, J. (2024). Does working capital management improve financial performance in China’s agri-food sector during COVID-19? A comparison with the 2008 financial crisis. Plos One, 19(4 April). Doi: 10.1371/journal.pone.0300217.
  29. Lokuwaduge, C., & de Silva, K. (2020). Emerging Corporate Disclosure of Environmental Social and Governance (ESG) Risks: An Australian Study. Australasian Accounting, Business and Finance Journal, 14(2), 35-50. Doi: 10.14453/aabfj.v14i2.4.
  30. Lopes Santos, D. F., Valente Rezende, M. D., & Cruz Basso, L. F. (2019). Ecoinnovation and business performance in emerging and developed economies. Journal of Cleaner Production, 237, 117674. Doi: 10.1016/j.jclepro.2019.117674.
  31. Lu, W.-M., Chou, C.-H., Ting, I. W. K., & Cheng, K.-C. (2026). Dynamic performance evaluation of Taiwan’s food industry: ESG insights and strategic implications. Omega United Kingdom, 138. Doi: 10.1016/j.omega.2025.103376.
  32. Madison, N., & Schiehll, E. (2021). The Effect of Financial Materiality on ESG Performance Assessment. Sustainability, 13(7), 3652. Doi: 10.3390/su13073652.
  33. Manrique, S., & Martí-Ballester, C.-P. (2017). Analyzing the Effect of Corporate Environmental Performance on Corporate Financial Performance in Developed and Developing Countries. Sustainability, 9(11), 1957. Doi: 10.3390/su9111957.
  34. Martins, H. C. (2022). Competition and ESG practices in emerging markets: Evidence from a difference-in-differences model. Finance Research Letters, 46, 102371. Doi: 10.1016/j.frl.2021.102371.
  35. MSCI (2023). MSCI Index ESG Metrics Calculation Methodology. -- https://www.msci.com/documents/10199/1283513/MSCI_ESG_Metrics_Calc_Methodology_Dec2020.pdf/92a299cb-0dbc-63ba-debb-e821bd2e2b08.
  36. Naffa, H., & Fain, M. (2020). Performance measurement of ESG-themed megatrend investments in global equity markets using pure factor portfolios methodology. Plos One, 15(12 December). Doi: 10.1371/journal.pone.0244225.
  37. Nirino, N., Miglietta, N., & Salvi, A. (2019). The impact of corporate social responsibility on firms’ financial performance, evidence from the food and beverage industry. British Food Journal, 122(1), 1-13. Doi: 10.1108/BFJ-07-2019-0503.
  38. Park, S. R., & Jang, J. Y. (2021). The Impact of ESG Management on Investment Decision: Institutional Investors’ Perceptions of Country-Specific ESG Criteria. International Journal of Financial Studies, 9(3), 48. Doi: 10.3390/ijfs9030048.
  39. Partalidou, X., Zafeiriou, E., Giannarakis, G., & Sariannidis, N. (2020). The effect of corporate social responsibility performance on financial performance: the case of food industry. Benchmarking: An International Journal, 27(10), 2701-2720. Doi: 10.1108/BIJ-11-2019-0501.
  40. Pawliczek, A., Skinner, A. N., & Wellman, L. A. (2021). A new take on voice: the influence of BlackRock’s ‘Dear CEO’ letters. Review of Accounting Studies, 26(3), 1088-1136. Doi: 10.1007/s11142-021-09603-x.
  41. Peiris, D., & Evans, J. (2010). The Relationship Between Environmental Social Governance Factors and U.S. Stock Performance. The Journal of Investing, 19(3), 104-112. Doi: 10.3905/joi.2010.19.3.104.
  42. Pettenuzzo, D., Sabbatucci, R., & Timmermann, A. (2023). Dividend suspensions and cash flows during the Covid-19 pandemic: A dynamic econometric model. Journal of Econometrics, 235(2), 1522-1541. Doi: 10.1016/j.jeconom.2022.11.008.
  43. Raghunandan, A., & Rajgopal, S. (2022). Do ESG funds make stakeholder-friendly investments? Review of Accounting Studies, 27(3), 822-863. Doi: 10.1007/s11142-022-09693-1.
  44. Shakil, M. H. (2021). Environmental, social and governance performance and financial risk: Moderating role of ESG controversies and board gender diversity. Resources Policy, 72, 102144. Doi: 10.1016/j.resourpol.2021.102144.
  45. Sharma, P., Panday, P., & Dangwal, R. C. (2020). Determinants of environmental, social and corporate governance (ESG) disclosure: a study of Indian companies. International Journal of Disclosure and Governance, 17(4), 208-217. Doi: 10.1057/s41310-020-00085-y.
  46. Sulimany, H. G., Ramakrishnan, S., Chaudhry, A., & Bazhair, A. H. (2021). Impact of Corporate Governance and Financial Sustainability on Shareholder Value. Studies of Applied Economics, 39(4). Doi: 10.25115/eea.v39i4.4318.
  47. Sun, Y., & Li, Y. (2021). COVID-19 Outbreak and Financial Performance of Chinese Listed Firms: Evidence from Corporate Culture and Corporate Social Responsibility. Frontiers in Public Health, 9. Doi: 10.3389/fpubh.2021.710743.
  48. Talan, G., & Sharma, G. D. (2019). Doing Well by Doing Good: A Systematic Review and Research Agenda for Sustainable Investment. Sustainability, 11(2), 353. Doi: 10.3390/su11020353.
  49. Tleubayev, A., Bobojonov, I., Gagalyuk, T., Meca, E. G., & Glauben, T. (2021). Corporate governance and firm performance within the Russian agri-food sector: does ownership structure matter? International Food and Agribusiness Management Review, 24(4), 649-668. Doi: 10.22434/IFAMR2019.0184.
  50. Villiers, C., & Dimes, R. (2021). Determinants, mechanisms and consequences of corporate governance reporting: a research framework. Journal of Management and Governance, 25(1), 7-26. Doi: 10.1007/s10997-020-09530-0.
  51. Xu, J., Liu, F., & Shang, Y. (2021). R&D investment, ESG performance and green innovation performance: evidence from China. Kybernetes, 50(3), 737-756. Doi: 10.1108/K-12-2019-0793.
  52. Yao, R., Fei, Y., Wang, Z., Yao, X., & Yang, S. (2023). The Impact of China’s ETS on Corporate Green Governance Based on the Perspective of Corporate ESG Performance. International Journal of Environmental Research and Public Health, 20(3), 2292. Doi: 10.3390/ijerph20032292.
  53. Yoon, B., Lee, J. H., & Byun, R. (2018). Does ESG Performance Enhance Firm Value? Evidence from Korea. Sustainability, 10(10), 3635. Doi: 10.3390/su10103635.
  54. Zhang, Y., & Xiong, T. (2024). More ESG Practices, Higher Financial Performance? The U-Shaped Pattern in China’s Agricultural and Food Firms. Agribusiness. Doi: 10.1002/agr.21989.
  55. Zhao, C., Guo, Y., Yuan, J., Wu, M., Li, D., Zhou, Y., & Kang, J. (2018). ESG and Corporate Financial Performance: Empirical Evidence from China’s Listed Power Generation Companies. Sustainability, 10(8), 2607. Doi: 10.3390/su10082607.
  56. Zheng, F., Zhao, Z., Sun, Y., & Khan, Y. A. (2023). Financial performance of China’s listed firms in presence of coronavirus: Evidence from corporate culture and corporate social responsibility. Current Psychology, 42(11), 8897-8918. Doi: 10.1007/s12144-021-02200-w.
  57. Zheng, J., Khurram, M. U., & Chen, L. (2022). Can Green Innovation Affect ESG Ratings and Financial Performance? Evidence from Chinese GEM Listed Companies. Sustainability (Switzerland), 14(14). Doi: 10.3390/su14148677.
  58. Zhong, M., Lu, F., Zhu, Y., & Chen, J. (2022). What Corporate Social Responsibility (CSR) Disclosures Do Chinese Forestry Firms Make on Social Media? Evidence from WeChat. Forests, 13(11), 1842. Doi: 10.3390/f13111842.