Effects of economic policy uncertainty and geopolitical risk on corporate environmental social governance performance

The purpose of this thesis is to investigate, first, the impact of Economic Policy Uncertainty (EPU) and Geopolitical risk (GPR) on corporate Environmental Social Governance (ESG) performance of companies in OECD countries, covering the period from 2007 to 2022. Second, market competition is included as a moderating variable in the analysis to examine the impact of market competition on the relationship between EPU and corporate ESG performance, as well as its impact on the link between Geopolitical Risks and corporate ESG Performance. Results of this study reveal that uncertainty in the economic policy negatively influences corporate ESG performance, while Geopolitical risk positively affects corporate ESG performance. Examining the impact of the two separate interactions of market competition with the GPR and EPU on corporate ESG performance reveals that the impact of the interaction is not certain, but that competition alone has a direct negative impact on overall ESG performance.