ESG Score and Carbon Emission: Empirical Evidence in Malaysian Listed Companies

This study investigates how board effectiveness moderates the association between carbon emission and Environmental, Social, and Governance (ESG) scores of Malaysian listed corporations. Using data collected on 1051 Malaysian listed firms belonging to the year 2023, this study investigates the effect of ESG score on reducing the promotion of carbon emissions. The findings evidenced a negative relation of ESG scores against carbon emission, whereby the effect of board effectiveness was stronger in the companies. Such findings signify that firms which take sustainability seriously, especially through effective board effectiveness, have a great advantage in the reduction of carbon emission. Companies are encouraged to proactively and strategically reduce their carbon footprint, as part of a broader, comprehensive sustainability strategy, both to meet rising stakeholder expectations but also then to obtain high reductions of emissions for longer-term financial returns and competitive advantage.