ESG legitimacy games in retail management: balancing symbolic compliance and entrepreneurial legitimacy under policy and public pressure in China

This study examines the structural misalignment of Environmental, Social, and Governance (ESG) priorities among policy guidance, public attention, and corporate responses in China. Drawing on agenda-setting and legitimacy theory, it introduces a structural deviation index, a quantitative measure capturing the divergence among policy orientation, public concern, and firm-level ESG performance across E, S, and G dimensions. Using policy text analysis, Baidu Index data, and ESG ratings of 3,030 listed firms from 2019 to 2023, three pairwise distances – Policy–Corporate, Public–Corporate, and Policy–Public – are constructed. The results show that Policy–Corporate Distance is consistently the largest, indicating a significant gap between regulatory priorities and corporate behavior. The environmental dimension exhibits the greatest misalignment despite strong policy emphasis, while firms align more closely with public attention in social issues. Overall, firms tend to adopt symbolic compliance strategies, prioritizing low-cost governance and social initiatives over substantive environmental transformation. The findings also reflect emerging trends in social computing through digitally expressed public attention and their relevance to customer relationship management. For retail organizations, these findings offer strategic and operational applications for aligning ESG practices with consumer expectations, while providing managerial applications for strengthening market positioning, competitive differentiation, and customer relationships.