Driving Corporate Sustainable Development: Assessing the Impact of ESG Disclosure on Sustainable Growth

The primary objective of business growth is to attain long-term corporate expansion and optimise shareholder value. Additional research is required to investigate the impact of ESG disclosure on sustainable growth (SGR). By integrating stakeholder theory and signaling theory, a panel data analysis conducted on publicly traded A-share companies in China, reveals that disclosing ESG information can have a positive impact on promoting SGR. Companies that disclose ESG information experience greater promotion of sustainable growth compared to those that do not disclose such information. Moreover, the extent of ESG disclosure positively correlates with the magnitude of the beneficial impact on SGR. Additionally, ESG disclosure contributes to SGR by alleviating financing constraints as well as improving human capital. The results of our study enhance the existing knowledge on ESG disclosure, encourage companies to actively engage in ESG disclosure for SGR, and contribute to a deeper understanding of the relationship between ESG reporting and sustainable business growth.