Cover Image

ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance

Environmental, Social and Governance (ESG) is one of the vital concerns in the current corporate environment. Firms must be transparent on ESG issues to create sustainable value and fulfill stakeholders’ rights. Since the late 2000s, many countries, including ASEAN countries, have mandated ESG discl...

Full description

Saved in:
Bibliographic Details
Main Authors: Ab Aziz, Noor Hidayah, Abdul Latiff, Ahmed Razman, Alshdaifat, Sajead Mowafaq, Osman, Mohammad Noor Hisham, Azmi, Nurul Azlin
Format: Article
Published: Human Resource Management Academic Research Society 2023
Online Access:http://psasir.upm.edu.my/id/eprint/111635/
https://hrmars.com/index.php/IJARBSS/article/view/19140/ESG-Disclosure-and-Firm-Performance-Evidence-after-the-Revision-of-Malaysian-Code-of-Corporate-Governance
Tags: Add Tag
No Tags, Be the first to tag this record!
id my.upm.eprints.111635
record_format eprints
spelling my.upm.eprints.1116352024-07-19T03:12:55Z http://psasir.upm.edu.my/id/eprint/111635/ ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance Ab Aziz, Noor Hidayah Abdul Latiff, Ahmed Razman Alshdaifat, Sajead Mowafaq Osman, Mohammad Noor Hisham Azmi, Nurul Azlin Environmental, Social and Governance (ESG) is one of the vital concerns in the current corporate environment. Firms must be transparent on ESG issues to create sustainable value and fulfill stakeholders’ rights. Since the late 2000s, many countries, including ASEAN countries, have mandated ESG disclosure to increase transparency. This study aims to examine the effect of ESG disclosure on firm performance measured by profitability indicators among Malaysian public listed firms with the data collected from 2017 after the revision of the Malaysian corporate governance code from ‘comply and explain’ to ‘apply and explain’ until 2021. The data was gathered from the Thomson Reuters Eikon Database, which consists of ESG scores and firm profitability through ROA and ROE. Using OLS regression method, the results indicate that ESG disclosure positively and significantly affects ROA and ROE. While, the results of each individual pillar of ESG (environmental, social and governance) revealed that only ROA was strongly impacted by all the pillars, whereas ROE was only affected by the social pillar. Further analysis revealed firms with higher ESG disclosure perform superior to those with lower ESG disclosure. This study helps to enrich the knowledge of ESG disclosure and its effect on firm performance. Particularly this study will help Malaysian firms to strategies on ESG disclosure to realise its impact on performance. Besides, capital market regulators will also have a direction to impose regulations pertinent to ESG. Human Resource Management Academic Research Society 2023 Article PeerReviewed Ab Aziz, Noor Hidayah and Abdul Latiff, Ahmed Razman and Alshdaifat, Sajead Mowafaq and Osman, Mohammad Noor Hisham and Azmi, Nurul Azlin (2023) ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance. International Journal of Academic Research in Business and Social Sciences, 13 (12). pp. 1-20. ISSN 2222-6990 https://hrmars.com/index.php/IJARBSS/article/view/19140/ESG-Disclosure-and-Firm-Performance-Evidence-after-the-Revision-of-Malaysian-Code-of-Corporate-Governance 10.6007/IJARBSS/v13-i12/19140
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
description Environmental, Social and Governance (ESG) is one of the vital concerns in the current corporate environment. Firms must be transparent on ESG issues to create sustainable value and fulfill stakeholders’ rights. Since the late 2000s, many countries, including ASEAN countries, have mandated ESG disclosure to increase transparency. This study aims to examine the effect of ESG disclosure on firm performance measured by profitability indicators among Malaysian public listed firms with the data collected from 2017 after the revision of the Malaysian corporate governance code from ‘comply and explain’ to ‘apply and explain’ until 2021. The data was gathered from the Thomson Reuters Eikon Database, which consists of ESG scores and firm profitability through ROA and ROE. Using OLS regression method, the results indicate that ESG disclosure positively and significantly affects ROA and ROE. While, the results of each individual pillar of ESG (environmental, social and governance) revealed that only ROA was strongly impacted by all the pillars, whereas ROE was only affected by the social pillar. Further analysis revealed firms with higher ESG disclosure perform superior to those with lower ESG disclosure. This study helps to enrich the knowledge of ESG disclosure and its effect on firm performance. Particularly this study will help Malaysian firms to strategies on ESG disclosure to realise its impact on performance. Besides, capital market regulators will also have a direction to impose regulations pertinent to ESG.
format Article
author Ab Aziz, Noor Hidayah
Abdul Latiff, Ahmed Razman
Alshdaifat, Sajead Mowafaq
Osman, Mohammad Noor Hisham
Azmi, Nurul Azlin
spellingShingle Ab Aziz, Noor Hidayah
Abdul Latiff, Ahmed Razman
Alshdaifat, Sajead Mowafaq
Osman, Mohammad Noor Hisham
Azmi, Nurul Azlin
ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance
author_facet Ab Aziz, Noor Hidayah
Abdul Latiff, Ahmed Razman
Alshdaifat, Sajead Mowafaq
Osman, Mohammad Noor Hisham
Azmi, Nurul Azlin
author_sort Ab Aziz, Noor Hidayah
title ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance
title_short ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance
title_full ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance
title_fullStr ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance
title_full_unstemmed ESG disclosure and firm performance: evidence after the revision of Malaysian code of corporate governance
title_sort esg disclosure and firm performance: evidence after the revision of malaysian code of corporate governance
publisher Human Resource Management Academic Research Society
publishDate 2023
url http://psasir.upm.edu.my/id/eprint/111635/
https://hrmars.com/index.php/IJARBSS/article/view/19140/ESG-Disclosure-and-Firm-Performance-Evidence-after-the-Revision-of-Malaysian-Code-of-Corporate-Governance
_version_ 1805889940577320960
score 13.211869

Similar Items