Proceedings of the 2025 7th International Conference on Economic Management and Cultural Industry (ICEMCI 2025)

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Exploring the Nonlinear Relationship between ESG Performance and Investment Inefficiency: The Moderating Role of Cost of Debt in Chinese Public Companies

Authors
Yining Wang1, *
1School of Economics, Shanghai University, Shanghai, 200444, China
*Corresponding author. Email: wangyining_2022@qq.com
Corresponding Author
Yining Wang
Available Online 3 December 2025.
DOI
10.2991/978-94-6463-888-2_52How to use a DOI?
Keywords
ESG Performance; Investment Inefficiency; Inverted U-shaped Relationship; Cost of Debt
Abstract

As the Chinese economy shifts from a rapid growth phase to a stage of high-quality development, Environmental, Social, and Governance (ESG) concepts have increasingly become critical indicators for assessing the sustainable development of enterprises, directly influencing the efficacy of investment decisions. Utilizing data from A-share listed companies in Shanghai, Shenzhen, and Beijing from 2011 to 2024, this study empirically examines the relationship between corporate ESG performance and investment inefficiency, while exploring the heterogeneous impacts of the corporate lifecycle and the moderating effect of cost of debt. Findings indicate the presence of a non-linear, inverted U-shaped relationship between ESG performance and investment inefficiency, predominantly driven by firms in the growth stage. Furthermore, the cost of debt financing serves as a negative moderating factor in this relationship. This research provides a theoretical foundation for optimizing ESG resource allocation across enterprises at various developmental stages and offers practical insights for policymakers aiming to enhance ESG incentive mechanisms and financing support policies. Additionally, it contributes to the broader discourse on ESG and corporate investment efficiency.

Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 2025 7th International Conference on Economic Management and Cultural Industry (ICEMCI 2025)
Series
Advances in Economics, Business and Management Research
Publication Date
3 December 2025
ISBN
978-94-6463-888-2
ISSN
2352-5428
DOI
10.2991/978-94-6463-888-2_52How to use a DOI?
Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Yining Wang
PY  - 2025
DA  - 2025/12/03
TI  - Exploring the Nonlinear Relationship between ESG Performance and Investment Inefficiency: The Moderating Role of Cost of Debt in Chinese Public Companies
BT  - Proceedings of the 2025 7th International Conference on Economic Management and Cultural Industry (ICEMCI 2025)
PB  - Atlantis Press
SP  - 533
EP  - 544
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-888-2_52
DO  - 10.2991/978-94-6463-888-2_52
ID  - Wang2025
ER  -