Do investors pay attention to the long-term sustainable company development?

Abstract

This study investigates whether the green concerns expressed by retail investors on online platforms affect the environmental, social, and governance (ESG) performance of companies in China's A-share market. The implementation of China's dual carbon targets has received significant public support. Investors in the capital market are increasingly emphasizing the green initiatives of the companies they invest in. This creates external pressure on publicly listed firms. Results indicate that retail investors' attention to environmental sustainability significantly enhances companies' ESG performance, primarily by boosting their market reputation. The effect is more pronounced in companies from regions with lower marketization levels, those that are private enterprises, and those in the manufacturing sector.