Journal of Environmental Science International (한국환경과학회지)

The Korean Environmental Sciences Society (한국환경과학회)
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The Effect of ESG Information on Investor Information Asymmetry

ESG 정보가 투자자 정보비대칭에 미치는 영향

  • Geon, Woo (Green Finance Graduate Program, Inha University) ;
  • Jong Dae, Kim (College of Business Administration, Inha University)
  • 우건 (인하대학교 대학원 녹색금융 전공) ;
  • 김종대 (인하대학교 경영대학)
  • Received : 2022.11.18
  • Accepted : 2022.12.05
  • Published : 2022.12.31
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Abstract

This study analyzed the effect of Corporate Social Responsibility and ESG (Environmental, Social and Governance) score on information asymmetry from the perspective of investors, who are important stakeholders of the company. For KOSPI-listed companies from 2017 to 2020, the effect of ESG overall score and each item score (E, S, G) on the bid-ask spread, which is a proxy for information asymmetry, was confirmed. The results are as follows. First, the increase in corporate CSR activities resulted in lowering information asymmetry of investors. It was found that the higher the ESG score, an indicator of CSR activity, the lower the bid-ask spread, which is a proxy variable for information asymmetry. Second, as a result of analysis using ESG scores for each section, information asymmetry decreased as companies with higher scores in the environmental (E) and social (S) aspects, while the governance (G) score did not have a statistically significant effect. The analysis confirmed that corporate CSR activities can contribute to improving market efficiency by resolving information asymmetry of investors and convergence of the stock market into a state of equilibrium. This means that the company's CSR activities are reflected in the investment decision-making, which suggests that the company should consider the investor as a stakeholder in decision-making related to CSR activities.

Keywords

Acknowledgement

본 연구는 환경부와 한국환경산업기술원의 『녹색융합기술 인재양성 특성화대학원 (녹색금융분야)』2차년도 사업의 지원을 받아 수행된 연구임.

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