<scp>FinTech</scp> Development and Corporate <scp>ESG</scp> Performance: Does Institutional Quality Really Matter?

ABSTRACT This 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.

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Publication Details

Journal
Corporate Social Responsibility and Environmental Management
Published
2026-06-16
DOI
https://doi.org/10.1002/csr.70765
Primary Topic
FinTech, Crowdfunding, Digital Finance
Type
article
Field-Weighted Citation Impact
0.00
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article

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

Nasir Khan, Naif Alsagr
Corporate Social Responsibility and Environmental Management
FinTech, Crowdfunding, Digital Finance
article

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

Nasir Khan, Naif Alsagr
article en

Abstract

ABSTRACT This 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.

Corporate Social Responsibility and Environmental Management
Imam Mohammad ibn Saud Islamic University (SA), Paris School of Business (FR)
Industry, innovation and infrastructure
Openalex Percentile: Top 5%
FinTech, Crowdfunding, Digital Finance
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