Corporate ESG performance and litigation risk-based on ESG lawsuits of listed firms in China

The initial research sample for this study comprises all A-share listed firms from 2009 to 2020. This study utilizing a fixed-effects model discovers that superior ESG performance is associated with reduced litigation risk. Additionally, social responsibility and corporate governance have substantial effects on litigation risk. Further analysis identifies analyst coverage and managerial misconduct as the primary channels through which ESG performance affects litigation risk. The findings remain robust following several methods.