TY - JOUR
T1 - ESG disclosure and internal pay gap
T2 - Empirical evidence from China
AU - Khurram, Muhammad Usman
AU - Chen, Lifeng
AU - Abedin, Mohammad Zoynul
AU - Adu, Douglas A.
AU - Lucey, Brian
N1 - Publisher Copyright:
© 2024 Elsevier Inc.
PY - 2024/4
Y1 - 2024/4
N2 - This study aims to examine how ESG disclosure can modify the internal pay gap between executives and employees, especially green, high-tech, and SOE enterprises in China. We employed Bloomberg's ESG disclosure score from 2015 to 2019 to identify the U-shape relationship between ESG disclosure and the internal Pay gap (IPG), adopting the differentiation grouping method of green enterprises, high-tech enterprises, and State-owned enterprises (SOEs) to explore the impact of enterprise heterogeneity, providing more policy enlightenment on ESG performance. Our findings indicate a significant U-shaped relationship between ESG disclosure and the internal pay gap, and endogenous characteristics of green and high-tech enterprises have a positive moderating effect within this U-shaped relationship. These findings are statistically significant and consistent with transmissions with endogenous characteristics of the enterprises. Notably, the connectedness shows dynamic patterns by 2SLS and GMM regression, highlighting the risk of ESG disclosure being the shock transmitters to enterprise internal control. Our study is prone to benefit lawmakers, regulators, and firm executives responsible for analyzing and assessing the pay gap.
AB - This study aims to examine how ESG disclosure can modify the internal pay gap between executives and employees, especially green, high-tech, and SOE enterprises in China. We employed Bloomberg's ESG disclosure score from 2015 to 2019 to identify the U-shape relationship between ESG disclosure and the internal Pay gap (IPG), adopting the differentiation grouping method of green enterprises, high-tech enterprises, and State-owned enterprises (SOEs) to explore the impact of enterprise heterogeneity, providing more policy enlightenment on ESG performance. Our findings indicate a significant U-shaped relationship between ESG disclosure and the internal pay gap, and endogenous characteristics of green and high-tech enterprises have a positive moderating effect within this U-shaped relationship. These findings are statistically significant and consistent with transmissions with endogenous characteristics of the enterprises. Notably, the connectedness shows dynamic patterns by 2SLS and GMM regression, highlighting the risk of ESG disclosure being the shock transmitters to enterprise internal control. Our study is prone to benefit lawmakers, regulators, and firm executives responsible for analyzing and assessing the pay gap.
KW - China
KW - ESG disclosure
KW - Green enterprises
KW - High-tech enterprises
KW - Internal pay gap
KW - State-owned enterprises
UR - http://www.scopus.com/inward/record.url?scp=85185595301&partnerID=8YFLogxK
U2 - 10.1016/j.iref.2024.02.023
DO - 10.1016/j.iref.2024.02.023
M3 - Article
AN - SCOPUS:85185595301
SN - 1059-0560
VL - 92
SP - 228
EP - 244
JO - International Review of Economics and Finance
JF - International Review of Economics and Finance
ER -