The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method

Xiao Lu; Minxing Zhu

doi:doi:10.11648/j.eco.20231202.13

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The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method

Xiao Lu, Minxing Zhu

Published in Economics (Volume 12, Issue 2)

Received: 8 May 2023 Accepted: 23 May 2023 Published: 29 May 2023

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Abstract

In recent years, green finance has led to increased focus on ESG performance, measuring corporate social responsibility. Meanwhile, mergers and acquisitions (M&A) play a crucial role in international capital flow, which have attracted widespread attention. Exploring the impact of foreign M&A on ESG performance of companies has become an important research topic. Based on the sample of foreign mergers and acquisitions of Chinese listed companies from 2017 to 2022, this paper innovatively examines the impact and mechanism of foreign M&A on Chinese listed companies' ESG performance using propensity score matching and multi-period difference-in-differences methods. Findings indicate: (1) Foreign M&A significantly improves corporate ESG performance; (2) The impact of foreign M&A varies across different types of enterprises. Regarding the acquiring companies, foreign companies have a greater impact on improving ESG performance compared to companies from Hong Kong, Macau, and Taiwan. On the target companies' side, large-scale companies are more effective in utilizing the opportunities provided by mergers and acquisitions (M&A) to leverage their advantages. (3) Foreign M&A is particularly effective in enhancing environmental indicators within the ESG framework; (4) The mechanism behind this improvement involves a significant green culture effect, which promotes the improvement of ESG performance by amplifying the influence of corporate green culture.

Published in	Economics (Volume 12, Issue 2)
DOI	10.11648/j.eco.20231202.13
Page(s)	53-60
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

ESG, Foreign M&A, DID-PSM

References

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[6]	Conyon M J, Girma S, Thompson S, et al. The productivity and wage effects of foreign acquisition in the United Kingdom [J]. The Journal of Industrial Economics, 2002, 50 (1): 85-102.
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[10]	Borghesi, R., Houston, J. F., & Naranjo, A. (2014). Corporate socially responsible investments: CEO altruism, reputation, and shareholder interests. Journal of Corporate Finance, 26, 164-181.
[11]	Boone A, Uysal V B. Reputational concerns in the market for corporate control [J]. Journal of Corporate Finance, 2020, 61: 101399.
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Xiao Lu, Minxing Zhu. (2023). The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method. Economics, 12(2), 53-60. https://doi.org/10.11648/j.eco.20231202.13

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ACS Style

Xiao Lu; Minxing Zhu. The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method. Economics. 2023, 12(2), 53-60. doi: 10.11648/j.eco.20231202.13

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AMA Style

Xiao Lu, Minxing Zhu. The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method. Economics. 2023;12(2):53-60. doi: 10.11648/j.eco.20231202.13

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@article{10.11648/j.eco.20231202.13,
  author = {Xiao Lu and Minxing Zhu},
  title = {The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method},
  journal = {Economics},
  volume = {12},
  number = {2},
  pages = {53-60},
  doi = {10.11648/j.eco.20231202.13},
  url = {https://doi.org/10.11648/j.eco.20231202.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.eco.20231202.13},
  abstract = {In recent years, green finance has led to increased focus on ESG performance, measuring corporate social responsibility. Meanwhile, mergers and acquisitions (M&A) play a crucial role in international capital flow, which have attracted widespread attention. Exploring the impact of foreign M&A on ESG performance of companies has become an important research topic. Based on the sample of foreign mergers and acquisitions of Chinese listed companies from 2017 to 2022, this paper innovatively examines the impact and mechanism of foreign M&A on Chinese listed companies' ESG performance using propensity score matching and multi-period difference-in-differences methods. Findings indicate: (1) Foreign M&A significantly improves corporate ESG performance; (2) The impact of foreign M&A varies across different types of enterprises. Regarding the acquiring companies, foreign companies have a greater impact on improving ESG performance compared to companies from Hong Kong, Macau, and Taiwan. On the target companies' side, large-scale companies are more effective in utilizing the opportunities provided by mergers and acquisitions (M&A) to leverage their advantages. (3) Foreign M&A is particularly effective in enhancing environmental indicators within the ESG framework; (4) The mechanism behind this improvement involves a significant green culture effect, which promotes the improvement of ESG performance by amplifying the influence of corporate green culture.},
 year = {2023}
}

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TY  - JOUR
T1  - The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method
AU  - Xiao Lu
AU  - Minxing Zhu
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PY  - 2023
N1  - https://doi.org/10.11648/j.eco.20231202.13
DO  - 10.11648/j.eco.20231202.13
T2  - Economics
JF  - Economics
JO  - Economics
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AB  - In recent years, green finance has led to increased focus on ESG performance, measuring corporate social responsibility. Meanwhile, mergers and acquisitions (M&A) play a crucial role in international capital flow, which have attracted widespread attention. Exploring the impact of foreign M&A on ESG performance of companies has become an important research topic. Based on the sample of foreign mergers and acquisitions of Chinese listed companies from 2017 to 2022, this paper innovatively examines the impact and mechanism of foreign M&A on Chinese listed companies' ESG performance using propensity score matching and multi-period difference-in-differences methods. Findings indicate: (1) Foreign M&A significantly improves corporate ESG performance; (2) The impact of foreign M&A varies across different types of enterprises. Regarding the acquiring companies, foreign companies have a greater impact on improving ESG performance compared to companies from Hong Kong, Macau, and Taiwan. On the target companies' side, large-scale companies are more effective in utilizing the opportunities provided by mergers and acquisitions (M&A) to leverage their advantages. (3) Foreign M&A is particularly effective in enhancing environmental indicators within the ESG framework; (4) The mechanism behind this improvement involves a significant green culture effect, which promotes the improvement of ESG performance by amplifying the influence of corporate green culture.
VL  - 12
IS  - 2
ER  -

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Author Information

Xiao Lu

Finance, Zhongnan University of Economics and Law, Wuhan, China
Minxing Zhu

Finance, Zhongnan University of Economics and Law, Wuhan, China

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APA Style

Xiao Lu, Minxing Zhu. (2023). The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method. Economics, 12(2), 53-60. https://doi.org/10.11648/j.eco.20231202.13

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ACS Style

Xiao Lu; Minxing Zhu. The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method. Economics. 2023, 12(2), 53-60. doi: 10.11648/j.eco.20231202.13

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AMA Style

Xiao Lu, Minxing Zhu. The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method. Economics. 2023;12(2):53-60. doi: 10.11648/j.eco.20231202.13

Copy | Download

@article{10.11648/j.eco.20231202.13,
  author = {Xiao Lu and Minxing Zhu},
  title = {The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method},
  journal = {Economics},
  volume = {12},
  number = {2},
  pages = {53-60},
  doi = {10.11648/j.eco.20231202.13},
  url = {https://doi.org/10.11648/j.eco.20231202.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.eco.20231202.13},
  abstract = {In recent years, green finance has led to increased focus on ESG performance, measuring corporate social responsibility. Meanwhile, mergers and acquisitions (M&A) play a crucial role in international capital flow, which have attracted widespread attention. Exploring the impact of foreign M&A on ESG performance of companies has become an important research topic. Based on the sample of foreign mergers and acquisitions of Chinese listed companies from 2017 to 2022, this paper innovatively examines the impact and mechanism of foreign M&A on Chinese listed companies' ESG performance using propensity score matching and multi-period difference-in-differences methods. Findings indicate: (1) Foreign M&A significantly improves corporate ESG performance; (2) The impact of foreign M&A varies across different types of enterprises. Regarding the acquiring companies, foreign companies have a greater impact on improving ESG performance compared to companies from Hong Kong, Macau, and Taiwan. On the target companies' side, large-scale companies are more effective in utilizing the opportunities provided by mergers and acquisitions (M&A) to leverage their advantages. (3) Foreign M&A is particularly effective in enhancing environmental indicators within the ESG framework; (4) The mechanism behind this improvement involves a significant green culture effect, which promotes the improvement of ESG performance by amplifying the influence of corporate green culture.},
 year = {2023}
}

Copy | Download

TY  - JOUR
T1  - The Impact of Foreign Mergers and Acquisitions on ESG Performance of Chinese Listed Companies: Empirical Analysis Based on the PSM-DID Method
AU  - Xiao Lu
AU  - Minxing Zhu
Y1  - 2023/05/29
PY  - 2023
N1  - https://doi.org/10.11648/j.eco.20231202.13
DO  - 10.11648/j.eco.20231202.13
T2  - Economics
JF  - Economics
JO  - Economics
SP  - 53
EP  - 60
PB  - Science Publishing Group
SN  - 2376-6603
UR  - https://doi.org/10.11648/j.eco.20231202.13
AB  - In recent years, green finance has led to increased focus on ESG performance, measuring corporate social responsibility. Meanwhile, mergers and acquisitions (M&A) play a crucial role in international capital flow, which have attracted widespread attention. Exploring the impact of foreign M&A on ESG performance of companies has become an important research topic. Based on the sample of foreign mergers and acquisitions of Chinese listed companies from 2017 to 2022, this paper innovatively examines the impact and mechanism of foreign M&A on Chinese listed companies' ESG performance using propensity score matching and multi-period difference-in-differences methods. Findings indicate: (1) Foreign M&A significantly improves corporate ESG performance; (2) The impact of foreign M&A varies across different types of enterprises. Regarding the acquiring companies, foreign companies have a greater impact on improving ESG performance compared to companies from Hong Kong, Macau, and Taiwan. On the target companies' side, large-scale companies are more effective in utilizing the opportunities provided by mergers and acquisitions (M&A) to leverage their advantages. (3) Foreign M&A is particularly effective in enhancing environmental indicators within the ESG framework; (4) The mechanism behind this improvement involves a significant green culture effect, which promotes the improvement of ESG performance by amplifying the influence of corporate green culture.
VL  - 12
IS  - 2
ER  -

Copy | Download