ESG Performance and Brand Value in China: The Mediating and Threshold Roles of Innovation Investment

Brand value is a strategic intangible asset that strengthens firms’ competitiveness and supports sustainable growth. This study examines the association between corporate environmental, social, and governance (ESG) performance and brand value using 8170 firm-year observations from Chinese A-share-listed companies during 2020–2024. Results show that ESG performance is positively and significantly associated with brand value. Mechanism analysis further indicates that innovation investment, proxied by annual firm-level R&D expenditure (INNO), mediates this association in the primary specification. The indirect effect remains positive when log-transformed R&D expenditure is used, whereas R&D intensity does not support the mediation effect. From a nonlinear perspective, the full-sample analysis identifies a significant single threshold in R&D expenditure, above which the ESG coefficient is significantly larger. Industry-level analyses show the same single-threshold pattern in both high-tech and traditional firms. Because R&D expenditure measures innovation input rather than realized innovation output, the estimated thresholds are interpreted as sample-specific empirical breakpoints rather than universal or optimal R&D-investment targets.