Sustainable corporate governance and firm performance

Overview

Businesses are now under intense pressure from different stakeholders to take more responsibility in reducing the negative impact of climate change and achieving the United Nation’s sustainable development goals (UN SDGs). Besides the conventional performance matrix (financial performance), stakeholders (i.e., fund providers, investors, banks, customers, employees) have recently been paying attention to the non-financial performance of businesses for the decision-making process, such as funding, investment, trading, etc.

Sustainable corporate governance is a strategic response to evolving stakeholder expectations. Companies are adopting governance structures that embed environmental and social considerations into their decision-making processes. This involves a cultural shift towards ethical and sustainable business practices. Companies are increasingly accountable not only for financial outcomes but also for the broader impact of their operations on the environment, society, and long-term economic stability.

Therefore, this research project aims to (i) Evaluate the extent to which sustainability principles are integrated into existing corporate governance structure. (ii)Explore the new requirements for corporate governance to respond to climate issues and achieve UN Sustainable Development Goals; (iii) Examine the impact of sustainable corporate governance on firm performance from both financial and non-financial perspectives (including corporate social responsibility performance, ESG performance, EDI performance, etc.). This project intends to contribute not only to academic knowledge but also to the practical implementation of sustainable corporate governance.