Яшил иқтисодиёт ва тараққиёт Volume 4 Issue 6 (2026)
THE IMPACT OF ESG PERFORMANCE ON FIRM FINANCIAL PERFORMANCE: EVIDENCE FROM CHINESE LISTED MANUFACTURING FIRMS
Axmadov, Shukurbek, Urinov, Bobur
Abstract
The study investigates the relationship between Environmental, Social, and Governance (ESG)performance and firm financial performance among publicly listed manufacturing companies in China over theperiod 2020-2024. Using panel data from 40 firms listed on the Shanghai and Shenzhen Stock Exchanges, theresearch applies Fixed Effects panel regression to examine whether ESG performance, measured by RefinitivESG scores, significantly affects firm profitability as captured by Return on Assets (ROA). Firm size and leverageare included as control variables. The results show a positive and statistically significant association betweenESG scores and ROA, suggesting that Chinese manufacturing firms with stronger sustainability practices tendto achieve higher profitability. The findings are consistent with Stakeholder Theory and the Resource-BasedView of the firm. This study contributes to the growing empirical literature on ESG in emerging markets andoffers practical guidance for corporate managers, investors, and policymakers
ESG performance, Return on Assets (ROA), China, manufacturing, panel data, Stakeholder Theory, emerging markets
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