Journal of Applied Finance & Banking

Does Ownership Structure Matter? The Moderating Role of Ownership Structure in the ESG–Firm Value Relationship: Evidence from Taiwanese Financial Holding Companies

• [ Download ]
• Times downloaded: 6

• Abstract

   

  This study investigates the relationship between environmental, social, and governance (ESG) performance, ownership structure, and firm value using a sample of 13 Taiwanese financial holding companies. ESG performance is measured by the Taiwan ESG (TESG) score, while Tobin's Q serves as a proxy for firm value. Institutional ownership, blockholder ownership, and board ownership are incorporated as moderating variables. The empirical results indicate that ESG performance is positively associated with firm value. Institutional ownership strengthens the positive relationship between ESG performance and firm value, whereas blockholder ownership weakens this relationship. In contrast, board ownership does not exhibit a significant moderating effect. These findings suggest that the value-creating effect of ESG performance depends not only on firms' sustainability initiatives but also on their ownership structure, highlighting the critical role of corporate governance in translating ESG performance into firm value.

   

  JEL classification numbers: G32.

  Keywords: ESG performance, Firm value, Ownership structure, Financial holding companies.