RELEVANCE OF ENVIRONMENT, SOCIAL, GOVERNANCE (ESG) PERFORMANCE ON MARKET VALUE AND FIRM PERFORMANCE OF LISTED COMPANIES ON STOCK EXCHANGE OF THAILAND: AN INDEX REFLECTING THE MOVEMENT OF THE FIRST 50 STOCK PRICES

Abstract

This research aimed to study (1) relevance of Environmental, Social, and Governance (ESG) performance on market value of the Company (2) relevance of Environmental, Social, and Governance (ESG) performance on Return On Asset (ROA) and (3) relevance of Environmental, Social, and Governance (ESG) performance on Return On Equity (ROE). This research is quantitative, and the sample is the listed companies on the Stock Exchange of Thailand: And index group reflecting the movement of the first 50 stock prices with ESG rating assessment results by MSCI from 2019 to 2023, totaling 27 companies, using a specific selection method. Statistics used in data analysis consist of descriptive analysis and multiple regression analysis. The results reveal that environmental, social, and governance (ESG) performance has a positive relationship at a statistical significance level of 0.05 with market value and company performance
as measured by return on total assets (ROA) and return on equity (ROE). This indicates that companies with better ESG performance are able to increase their market value and achieve higher ROA and ROE. In addition, ESG performance has the most significant impact on market value compared to ROA and ROE, aligning with the theory that stakeholders can drive effective corporate performance when considering the interests of all stakeholders, not only shareholders.