| dc.description.abstract | The study investigates how the quality of auditing influences the association
between environmental, social, and governance (ESG) and financial performance in
emerging Asian markets. The research consists of a sample of 205 nonfinancial listed
companies in Asian emerging countries, spanning 2050 firm-year observations from 2014
to 2023. Data analysis relies on the Thomson Eikon database, which offers both financial
and ESG data. Our findings reveal that ESG and its elements have a detrimental impact
on financial performance, specifically the return on assets, aligning with the trade-off
theory in which ESG practices raise expenses and reduce profitability. However, ESG
initiatives positively influence sales revenue, as customers tend to favor companies with
strong ESG practices. Subcomponents of ESG further support these conclusions. The
subsequent phase of the study explores how audit quality, particularly as assessed by Big
Four auditors, moderates the relationship between ESG and CFP. Results indicate that
both ESG and higher audit quality have adverse effects on financial outcomes. These
outcomes hold true across different measures of CFP, bolstering the robustness of the
findings. These results add to our understanding of the link between ESG and CFP in
rising Asian nations and the impact of external auditor quality on it. | en_US |
