Impact of ESG (Environmental, Social, and Governance) Criteria on Investment Decisions

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Quantitative analysis reveals ESG scores significantly influence investment flows in various sectors, suggesting importance in governance.

Investment choices are largely determined by ESG scores, with governance having the greatest impact among sectors.
Governance had a significant influence (β = 0.41), followed by environmental (β = 0.32) and social (β = 0.18) aspects.
The study used quantitative methods and evaluated data from 200 public trading companies between 2015 and 2023.
Research highlights the need for a clear ESG disclosure process to attract investor interest over time.

Lalhunthara et al. (2025) studied this question.

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Quantitative analysis reveals ESG scores significantly influence investment flows in various sectors, suggesting importance in governance.