The impact of mergers and acquisitions on ESG performance in Asia Pasific
DOI:
https://doi.org/10.24914/jeb.v29i1.17060Keywords:
Mergers and acquisitions, environmental social and governance (ESG), Asia Pacific, conglomerationAbstract
This study examines the impact of mergers and acquisitions (M&A) on the Environmental, Social, and Governance (ESG) performance of non-financial firms in Asia Pacific from 2014 to 2023. Using a sample of 87 M&A transactions from the Refinitiv database, the research investigates how the target-to-acquirer ESG ratio and conglomeration strategy influence post-M&A ESG performance. Using OLS regression with robust standard errors, the results demonstrate that the target-to-acquirer ESG ratio positively and significantly affects changes in acquirers' ESG performance. Firm size also exhibits a significant positive effect. Nonetheless, conglomeration strategy and other control variables have no significant effects. These findings suggest that acquiring firms with relatively higher ESG performance represent an effective strategy for enhancing corporate sustainability in the Asia Pacific region. They also demonstrate that larger firms have greater capacity to implement and improve post-M&A ESG practices. This study contributes to a better understanding of the effectiveness of M&A as a mechanism for improving sustainability across diverse institutional contexts.
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