The Impact of ESG Performance on Private Placement Discounts
DOI:
https://doi.org/10.54097/81bqd889Keywords:
ESG Performance; Private Placement; Information Asymmetry; Operational Risk.Abstract
Against the backdrop of frequent global external risks and deepening sustainable development, ESG factors increasingly influence capital markets. Existing research on ESG performance mainly focuses on its economic consequences, such as impacts on stock returns and corporate financing, while studies on private placement discount have centered on monitoring compensation, risk compensation, and information asymmetry. However, how ESG performance affects private placement discount in seasoned equity offerings remains understudied. This study expands ESG research boundaries and enriches private placement pricing theories. Using 2010–2023 A-share private placement data, we find ESG performance negatively correlates with discount rates, acting through mitigating information asymmetry and reducing operational risks. Further analysis reveals that the negative impact of ESG performance on the discount rate is more prominent in firms with high economic policy uncertainty, those in non-high-tech industries, and those with high media attention.
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