THE IMPACT OF ESG DISCLOSURE TRANSPARENCY ON M&A PERFORMANCE: AN EMPIRICAL STUDY BASED ON CHINESE A-SHARE LISTED COMPANIES

Abstract

Against the backdrop of increasing urgency in global climate governance, corporate ESG (Environmental, Social, and Governance) responsibilities have drawn significant attention. In China’s A-share market, issues such as fragmented information, excessive qualitative content, and insufficient structure in ESG transparency level have led to prominent information asymmetry risks in M&A activities. Existing research focuses predominantly on ESG ratings and has yet to systematically reveal the mechanisms through which ESG transparency level influences M&A performance, particularly lacking empirical examination of the mediating effect of financing constraints. Based on the principal-agent theory and other theoretical frameworks, this study combines literature review and empirical analysis, using A-share listed companies from 2010 to 2021 as the sample. By selecting Bloomberg ESG disclosure scores and integrating data from the CSMAR database, 870 valid M&A samples are obtained after screening. The study investigates how ESG transparency level enhances M&A performance by mitigating information asymmetry and verifies the mediating role of financing constraints. Through the construction of multiple linear regression models with control variables, the findings indicate that (1) ESG transparency level significantly improves M&A performance (the regression coefficient for long-term M&A performance is 0.010, significant at the 1% level), (2) ESG transparency level significantly alleviates financing constraints (coefficient of -0.014, significant at the 1% level), and (3) financing constraints have a significant negative impact on M&A performance (coefficient of -0.199, p < 0.05), with mediation tests confirming that financing constraints plays a partial mediating role in the “ESG transparency level–M&A performance” pathway. The conclusions demonstrate that ESG transparency level not only directly enhances M&A performance but also indirectly improves M&A outcomes by alleviating financing constraints. This research innovatively links disclosure transparency with M&A performance, reveals its underlying mechanism, and is the first to validate the critical mediating role of financing constraints. On a practical level, it is recommended that regulatory authorities accelerate the establishment of a mandatory ESG disclosure framework and guide resource allocation toward enterprises with higher transparency through policies such as green credit and tax incentives.