earticle

영어

This study empirically analyzes the impact of ESG management on business performance of foreign subsidiaries. The results indicate ESG of local subsidiaries improve business performance measured by financial and non-financial performance in the perspective of multinational corporation. Intriguingly, social management has a significant influence in the relationship with financial performance as governance has similar influence in the relationship with non-financial performance. The results of this study suggests it is indispensable to establish a transparent decision-making process by disclosing company information to improve non-financial performance of local subsidiaries. The fact that the significance of environmental management is relatively low compared to social or governance means that environmental regulations of Korea do not reach the global level yet. Thus, efforts should be made for preemptive response measure in preparation for strengthened environmental regulations in the future.