This study examines how reporting quality of environmental, social and governance (ESG) matters affects debt maturity structures and investment efficiency in an emerging market context.
Using panel data from 609 firm-year observations of non-financial companies listed on the Stock Exchange of Thailand (2019–2023), the study employs regression models based on insights drawn from information asymmetry and agency theories to investigate the links between ESG reporting quality, debt maturity structure and investment behaviour.
ESG reporting quality improves investment efficiency, with a more pronounced reduction in overinvestment, while short-term debt maturities mitigate both forms of inefficiency. High-quality ESG reporting moderates the association between short-term debt and investment efficiency by reducing both overinvestment and underinvestment.
Limited to the Thai non-financial firms and third-party ESG rating, the results reveal that ESG reporting quality enhances investment efficiency and investor/creditor confidence within emerging markets.
The findings provide new insights for shareholders, managers and policymakers, demonstrating how integrating ESG considerations into corporate strategy mitigates information asymmetry and agency issues, leading to more effective capital allocation.
To the best of the authors' knowledge, this study is the first to provide empirical evidence on how ESG reporting quality interacts with corporate financing decisions to influence investment behaviour, offering insights beyond existing studies on ESG and investment efficiency.
