Does investor attention affect sustainability performance? Evidence from ASEAN countries

Purpose Corporate sustainability development has become a concern for various parties around the world, including investors. In our study, we investigate the relationship between investor attention and sustainable performance in emerging economies. Design/methodology/approach Our study focuses on banking listing companies in ASEAN countries for the period 2015–2024 and applies ordinary least squares regression to test the models. Findings Our study shows that investor attention is positively associated with sustainability performance. In the view of the limited attention theory, investors focus on firms with better ESG implementation due to their limited time and energy. After addressing the endogeneity problems using the Generalized Method of Moment and lagged variable tests, the main results remain consistent and robust. Research limitations/implications We provide compelling evidence that investor attention serves as a powerful market-based mechanism for driving ESG improvements, suggesting that regulators and practitioners should proactively invest in and communicate sustainability initiatives to attract investors. Originality/value We highlight the importance of sustainability development for investors in bank industry in ASEAN.