ESG Rating Disagreement, Information Frictions, and Capital Structure Rebalancing: Evidence from Chinese A-Share Firms

초록

Purpose – This paper examines whether disagreement across ESG rating agencies is associated with slower capital structu re rebalancing and less favorable financing outcomes among Chinese A-share listed firms. Design/Methodology/Approach –­ Grounded in the dynamic capital structure framework, this study uses a panel of nonfinancial Chinese A-share firms over the period 2015–2023 to examine whether cross-agency ESG disagreement is associated with slower leverage adjustment toward estimated targets. The analysis further considers debt maturity, financing constraints, operating performance, and the moderating roles of disclosure quality, institutional monitoring, and analyst coverage. All specifications include firm and year fixed effects along with firm-level controls. Findings – ESG rating disagreement is negatively associated with annual leverage adjustment, suggesting slower capital structure rebalancing among firms facing more fragmented ESG assessments. Greater disagreement is also associated with lower long-term debt usage, higher short-term debt reliance, tighter financing constraints, and weaker operating performance. These adverse associations are attenuated when disclosure quality is higher and when external information intermediation is stronger. Research Implications – This study contributes to the literature by linking ESG information inconsistency to corporate financing behavior through the channel of information frictions. The findings offer practical implications for firms, investors, and regulators by underscoring the importance of enhancing the comparability, transparency, and interpretability of ESG assessments.

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