Impact Analysis of ESG Factors on Financial Efficiency of Developers

The purpose of the study is to identify the main key ESG factors that have the most significant impact on the financial indicators of developers. Among the tasks, the formation of an analysis methodology that can be best used by developers, taking into account the specifics of their activities, can be mentioned. It was determined that groups of ESG factors have different effects on the financial efficiency of companies. Social and environmental factors have the highest correlation with profitability on capital, and management factors are more closely associated with risk indicators, debt burden, and cost of capital. During the study, paired Pearson correlation coefficients were calculated to analyze the relationships between ESG indicators and financial indicators. This made it possible to rank ESG indicators by the degree of connection with financial results. For verification, Spearman correlation (by rank) and analysis of qualitative trends were additionally carried out. It was determined that transparency and openness are the most important factors of corporate governance that affect financial results through the mechanism of reducing information risk and strengthening ties with investors and partners. However, within the framework of the study, there are certain limitations for analysis that were formulated. This allows us to make better conclusions about the presented assessment. As a result of the study, it was determined that the most significant environmental indicators for managing the developer’s finances are energy efficiency, emission levels, and waste management, which help reduce costs and risks of regulatory sanctions. In the social area, labor safety, personnel development, and employee engagement have the greatest impact on the company’s productivity and costs. For corporate governance, the main factors that affect financial efficiency are the quality of the board of directors, ESG risk management, and transparency of reporting.