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FinTech Development and Corporate ESG Performance: Does Institutional Quality Really Matter?

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Corporate Social Responsibility and Environmental Management

Published online on

Abstract

["Corporate Social Responsibility and Environmental Management, EarlyView. ", "\nABSTRACT\nThis study examines the influence of financial technology (FinTech) on corporate environmental, social, and governance (ESG) performance and assesses the moderating role of institutional quality in this relationship across global markets. The analysis uses a comprehensive panel dataset of 5294 firms from America, Europe, and Asia over the period 2014–2023. We employ a combination of static and dynamic econometric techniques. The findings show that FinTech significantly improves firm ESG performance, with the strongest effect observed in regions characterized by high regulatory effectiveness and legal enforcement. Furthermore, institutional quality amplifies the FinTech‐ESG performance nexus, highlighting that robust governance structures enhance the sustainability benefits of financial innovation. Additionally, marginal effects analysis reveals a nonlinear relationship, whereby improvements in institutional frameworks lead to disproportionately greater ESG benefits from FinTech. These findings remain robust across alternative model specifications and different measures of key variables.\n"]