Environmental, Social and Governance (ESG) Disclosure and Its Impact on Financial Performance of Top 100 Companies in Malaysia and Australia
Sarannya Kengkathran, College of Graduate Studies, University Tenaga Nasional, Malaysia.
Manuscript received on September 08, 2019. | Revised Manuscript received on September 22, 2019. | Manuscript published on October 30, 2019. | PP: 3579-3584 | Volume-9 Issue-1, October 2019 | Retrieval Number: A2691109119/2019©BEIESP | DOI: 10.35940/ijeat.A2691.109119
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© The Authors. Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: The definition of Environmental, Social and Governance (ESG) is not obscure. ESG involvement is the proceeding dedication by commerce to act ethically and contribute to economic growth while improving the standard of life of the employees and their families as well as the people around them. In the attempt to investigate the impact of ESG disclosure on financial performance of top 100 companies in Malaysia and Australia, this research scrutinises the annual reports of top 100 companies in Malaysia and Australia based on market capitalisation in 2017. This research has considered a comparison between Malaysia, a developing country and Australia, a developed country due to the purpose of evaluating the levels of disclosure based on different regulatory requirements on ESG while assessing the impact of ESG disclosure on Company Financial Performance (CFP). The reason being Australia is chosen as a benchmark for Malaysia to enhance their regulatory requirement for level of ESG disclosure. Overall, it is found that there is a positive impact of ESG disclosure on CFP.
Keywords: Environmental, Social and Governance (ESG), Company Financial Performance (CFP), Annual report, stakeholder theory, Agency theory.