The Impact of ESG Ratings on Employee Performance in Companies

Abstract

Sustainability, environmental, social and governance (ESG) ratings have become an important indicator for investors to assess corporate performance. However, the impact of ESG ratings on corporate employee performance is not as clear. Some studies suggest that companies with high ESG ratings have an advantage in attracting and retaining good employees and are likely to perform better in terms of employee performance. On the other hand, some studies have found that the relationship between ESG ratings and employee performance is not necessarily statistically significant. Thus, while ESG ratings are emerging as a credibility indicator for companies among investors and consumers, the specific impact of ESG ratings on employee performance needs further research.