Sustainability and ESG-Driven Capital Structure: Evolving Paradigms in Corporate Finance

Unofficial AI-generated summary based on the public title and abstract. Not an official translation.

🔬研究者:This paper offers a comprehensive empirical test of ESG-integrated capital structure theories, useful for further research on climate finance and sustainable corporate finance.

🏢実務担当者:Corporate finance and sustainability teams can use the findings to align ESG improvements with financing strategies, potentially lowering capital costs.

🏛政策担当者:Regulators can consider how mandatory ESG disclosure might affect firms' leverage and investment decisions, especially in emerging markets where governance gaps exist.

This study examines the influence of environmental, social, and governance (ESG) performance and sustainability governance on corporate capital structure decisions across developed and emerging markets. Drawing on a balanced panel of 2,000 publicly listed firms over the period 2000–2024, the research integrates traditional capital structure theories, trade-off, pecking order, agency, and market timing, with contemporary ESG paradigms. Using fixed effects, random effects, panel-corrected standard errors, and system GMM estimators, the findings reveal that ESG performance increases leverage and debt maturity while significantly reducing the cost of capital. Governance quality amplifies these effects, particularly in emerging markets where institutional enforcement mechanisms are less mature.Robustness checks using alternative ESG metrics, subsample estimations, lagged specifications, and outlier exclusions confirm the stability of results. The evidence suggests that ESG and governance are structural determinants of financing strategy rather than peripheral sustainability attributes, effectively redefining traditional capital structure optimization under sustainability constraints. The study contributes to the development of ESG-integrated corporate finance models and offers policy-relevant insights for managers, investors, and regulators seeking to align financial architecture with long-term sustainability objectives.Copyright© 2026 The Author(s). This article is distributed under the terms of the license CC-BY 4.0., which permits any further distribution in any medium, provided the original work is properly cited.Article’s history: Received 25th of November, 2025; Revised 19th of January, 2026; Accepted 22nd of February, 2026; Available online: 15th of March, 2026. Published as article in the Volume XXI, Special Issue, 1(91), 2026.

• semanticscholar https://doi.org/10.57017/jaes.v21.si.1(91).09first seen 2026-05-15 20:53:27