The Impact of ESG Rating Discrepancies on Stock Price Crash Risk: An Analysis from The Perspective of Resource Constraints

Chengyan Li

doi:10.54097/r4n0hc24

Authors

Chengyan Li

DOI:

https://doi.org/10.54097/r4n0hc24

Keywords:

ESG rating discrepancies; Stock price crash risk; Resource constrints; Information transparency.

Abstract

In the context of the “dual carbon” era, ESG (Environmental, Social, and Governance) practices have become a crucial issue for corporate sustainable development. However, the information asymmetry caused by ESG rating discrepancies urgently needs to be analyzed, as it affects the risk of stock price crashes. This study investigates a sample of A-share listed companies from 2015 to 2022 and finds that ESG rating discrepancies significantly increase the risk of stock price crashes, with the social dimension being the primary driver of this effect. Mechanism tests reveal that ESG rating discrepancies influence the risk of stock price crashes by reducing information transparency. Heterogeneity analysis shows that this differential impact is more pronounced in firms with constrained resources. Our research demonstrates that the impact of ESG rating differences on capital market stability varies, thereby enriching the literature on the economic consequences of ESG and extending the research on the determinants of stock price crash risk from the perspective of resource constraints.

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