Research on the Impact of Deviation from Optimal Capital Structure on Corporate PerformanceAdjustment effect Based on ESG performance

This study utilizes data from Chinese A-share listed companies between 2013 and 2023 to examine the relationship between capital structure, ESG performance, and corporate performance. The findings indicate that, among non-financial listed companies, deviation from the optimal capital structureparticularly due to excessive debtsignificantly suppresses firm performance. Further analysis reveals an asymmetric moderating effect of ESG scores on this relationship: when firms are over-leveraged, strong ESG performance can mitigate the negative impact of capital structure deviation on performance; conversely, when firms are under-leveraged, improvements in ESG performance can amplify the positive effects of optimizing capital structure on corporate performance. Thus, the impact of capital structure on corporate performance varies depending on the level of ESG performance.