Citation

Ong, Yan Kai and Yip, Yen Yen and Lai, Kim Piew (2026) The Impact of ESG on Costs on Debts in Malaysian Public-Listed Firms. In: Intelligent Governance in the Big Data Era. Springer Science and Business Media Deutschland GmbH, pp. 205-213. ISBN 978-3-032-14697-7, 978-3-032-14698-4

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Abstract

This study examines how Malaysian business entities’ debt costs are affected by Environmental, Social, and Governance (ESG) scores. A panel regression analysis of 70 Malaysian public-listed firms from 2012 to 2022 shows that better ESG ratings lead to increased company debt costs. Malaysian lenders view ESG investments as potentially risky with reduced immediate profitability; therefore, applying these considerations during credit assessments, drives up financing costs for firms with better ESG scores. Although ESG practices help build a corporate reputation as well as equity-investor relations, they do not necessarily produce corresponding reductions in borrowing costs.

Item Type:	Book Section
Uncontrolled Keywords:	Costs of debt, ESG
Subjects:	H Social Sciences > HJ Public Finance > HJ8001-8899 Public debts
Divisions:	Faculty of Business (FOB)
Depositing User:	Ms Rosnani Abd Wahab
Date Deposited:	05 Jun 2026 04:25
Last Modified:	08 Jun 2026 09:15
URII:	http://shdl.mmu.edu.my/id/eprint/16012

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