Waleed Hussain

School of Business and Economics,

Universiti Putra Malaysia, Malaysia 

Faculty of Management Sciences

University of Kotli, Pakistan,

waleedhussainw@gmail.com 

ORCID 0009-0002-7419-5261

ESG disclosure, firm internationalization, and firm financial performance: Evidence from Asia-Pacific

Tze San Ong

School of Business and Economics,

Universiti Putra Malaysia, Serdang 43400, Malaysia;

Department of Business Administration, Daffodil International University, Dhaka 1341, Bangladesh

tzesan@upm.edu.my

ORCID 0000-0001-7756-9404

Fakarudin Bin Kamarudin

School of Business and Economics

Universiti Putra Malaysia, Malaysia

fakarudin@upm.edu.my

ORCID 0000-0001-8180-1173

Muhammad Asif Khan

Faculty of Management Sciences 

University of Kotli, Pakistan

khanasif82@uokajk.edu.pk

ORCID 0000-0002-3563-2951

Zoltán Bács

Faculty of Economics and Business 

University of Debrecen

Debrecen, Hungary

bacs.zoltan@econ.unideb.hu

ORCID 0000-0003-0612-658X

Abstract. Environmental, social and governance (ESG) disclosures maintain a sustainable strategic fit between the organization's goals and its changing environment and have an impact on the firm's ability to attract funds, gain competitiveness, and hence firm's financial performance (FFP). The objective of the present study is to evaluate the impact of environmental, social, and governance disclosures (ESGD) on firm financial performance (FFP), especially emphasizing the moderating role of firm internationalization. The study employed a panel dataset of 697 firms listed in the Asia-Pacific emerging economies from 2013 to 2022. The findings of the fixed effect and robust two-stage least square estimations reflect that the modern pillars of corporate social responsibility – ESGD - significantly and negatively influence FFP; however, the degrees of corporate internationalization (international intensity, geographical extensity) significantly and positively moderate the association between ESGD and FFP. The findings of the current study have several implications for regulatory bodies, practitioners, and administrative decision-making authorities in both government and corporations. We further recommend a course of action where an attempt can be made to encourage international trade that is best aligned with the Sustainable Development Goals.

Received: July, 2023

1st Revision: February, 2024

Accepted: May, 2024

DOI: 10.14254/2071-8330.2024/17-2/13

JEL Classification: M14, F23, G32

Keywords: ESG disclosures, firm internationalization, multinationals enterprises, firm financial performance