Managerial voice amidst conflicting signals: ESG rating divergence and interactive disclosure

Divergence in environmental, social, and governance (ESG) ratings creates significant informational friction, yet we know little about how firms strategically manage the resulting ambiguity. This study examines whether managers deploy interactive managerial voice in earnings communication conferences (ECCs) as a mechanism for responding to conflicting third-party assessments. Using data from Chinese listed firms between 2009 and 2022, we document a robust positive relation between ESG rating divergence and ECCs response quality. Consistent with a legitimacy threat mechanism, ESG rating divergence is associated with weaker organizational legitimacy. Moreover, when divergence is high, more responsive communication is associated with higher subsequent legitimacy and cumulative abnormal returns. The relation is also more pronounced for divergence among domestic rating agencies and is concentrated in firms facing greater pre-existing legitimacy pressure or higher costs of silence. Collectively, this study highlights the role of ECCs in addressing sustainability uncertainty and provides evidence relevant to the development of more consistent and comparable ESG evaluation frameworks in China.