Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From Korea
This study attempts to examine the relationship between environment, social, and governance (ESG) management and financial performance and the role of socially responsible investment in the National Pension Fund (NPF), Korea’s largest institutional investor. This study tries to provide evidence for...
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| Format: | Article |
| Language: | English |
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Frontiers Media S.A.
2022-05-01
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| Series: | Frontiers in Psychology |
| Subjects: | |
| Online Access: | https://www.frontiersin.org/articles/10.3389/fpsyg.2022.893535/full |
| _version_ | 1818211245895974912 |
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| author | Sungjin Son Jootae Kim |
| author_facet | Sungjin Son Jootae Kim |
| author_sort | Sungjin Son |
| collection | DOAJ |
| description | This study attempts to examine the relationship between environment, social, and governance (ESG) management and financial performance and the role of socially responsible investment in the National Pension Fund (NPF), Korea’s largest institutional investor. This study tries to provide evidence for the slack resource hypothesis by verifying whether companies with higher financial performance make more efforts to improve ESG performance. In addition, we tried to validate whether NPF is expanding its investments in corporations with high economic performance and high ESG performance. Based on our analysis, Korean companies with good financial performance actively participate in ESG. When we compared the performance between 2019 and 2020, companies with high ESG performance increased regardless of financial performance level, whereas companies with high financial performance and low ESG performance decreased. This represents that the perception and attitude of Korean companies toward ESG management are evolving. NPF has a high investment ratio for firms having a high ratio in both financial and ESG performance. NPF further invested in companies with high ESG performance, even if the financial performance is not decent. This study provides evidence that Korean companies’ interest in ESG management as well as the behavior of socially responsible investment of NPF are rising. |
| first_indexed | 2024-12-12T05:29:26Z |
| format | Article |
| id | doaj.art-33886604603c4bfba1f7534fd7bd53f5 |
| institution | Directory Open Access Journal |
| issn | 1664-1078 |
| language | English |
| last_indexed | 2024-12-12T05:29:26Z |
| publishDate | 2022-05-01 |
| publisher | Frontiers Media S.A. |
| record_format | Article |
| series | Frontiers in Psychology |
| spelling | doaj.art-33886604603c4bfba1f7534fd7bd53f52022-12-22T00:36:21ZengFrontiers Media S.A.Frontiers in Psychology1664-10782022-05-011310.3389/fpsyg.2022.893535893535Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From KoreaSungjin SonJootae KimThis study attempts to examine the relationship between environment, social, and governance (ESG) management and financial performance and the role of socially responsible investment in the National Pension Fund (NPF), Korea’s largest institutional investor. This study tries to provide evidence for the slack resource hypothesis by verifying whether companies with higher financial performance make more efforts to improve ESG performance. In addition, we tried to validate whether NPF is expanding its investments in corporations with high economic performance and high ESG performance. Based on our analysis, Korean companies with good financial performance actively participate in ESG. When we compared the performance between 2019 and 2020, companies with high ESG performance increased regardless of financial performance level, whereas companies with high financial performance and low ESG performance decreased. This represents that the perception and attitude of Korean companies toward ESG management are evolving. NPF has a high investment ratio for firms having a high ratio in both financial and ESG performance. NPF further invested in companies with high ESG performance, even if the financial performance is not decent. This study provides evidence that Korean companies’ interest in ESG management as well as the behavior of socially responsible investment of NPF are rising.https://www.frontiersin.org/articles/10.3389/fpsyg.2022.893535/fullESGstewardship codenational pension fundsocial performancecarbon emission reduction |
| spellingShingle | Sungjin Son Jootae Kim Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From Korea Frontiers in Psychology ESG stewardship code national pension fund social performance carbon emission reduction |
| title | Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From Korea |
| title_full | Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From Korea |
| title_fullStr | Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From Korea |
| title_full_unstemmed | Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From Korea |
| title_short | Environment, Social, and Governance Performance and Financial Performance With National Pension Fund Investment: Evidence From Korea |
| title_sort | environment social and governance performance and financial performance with national pension fund investment evidence from korea |
| topic | ESG stewardship code national pension fund social performance carbon emission reduction |
| url | https://www.frontiersin.org/articles/10.3389/fpsyg.2022.893535/full |
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