Does Corporate ESG Performance Alleviate Stock Price Delays?: Evidence from China

Stock price delays affect the pricing efficiency of capital markets, and alleviating stock price delays ensures the stable operation of capital markets. This study selects Chinese A-share listed companies on the Shanghai and Shenzhen Stock Exchanges from 2009 to 2021 to explore how corporate ESG performance affects stock price delays. We find that ESG performance significantly alleviates stock price delays. Furthermore, environmental uncertainty positively moderates the relationship between corporate ESG performance and stock price delays. Our mechanism tests show that ESG performance alleviates stock price delays by enhancing information transparency, improving accounting conservatism, and boosting investor sentiment. The results of the heterogeneity analysis indicate that the alleviating effect of corporate ESG performance on stock price delays is more significant for non-state-owned enterprises than for state-owned enterprises. Additionally, compared with enterprises in the eastern region, the alleviating effect of corporate ESG performance on stock price delays is more significant for enterprises in the central and western regions of China. This study provides empirical evidence for applying ESG information disclosure in the Chinese capital market and offers insights for government regulatory agencies to enhance their supervision of ESG information disclosure.