Abstract for: Identifying leverage points which impact firm value - The ESG lens on Nifty 100 firms

ESG (environment, social and governance ) regulations are taking center stage in shaping investor perceptions. The present article examines the impact of ESG parameters for market value of firms in Indian stock market. By applying a System Dynamics model we find the leverage points which can impact the firms which trail behind in implementation of ESG parameters. The Nifty 100 stocks from the Indian stock market are considered. The critical but neglected parameters which impact firm value out of 16 variables categorized under 3 broad heads of Environmental metrics, ESG disclosure and SDG goals are identified. Using k-mean clustering categorize the firms into i.e. forerunners, the resource guzzlers, the migrators and the trailers. Our findings suggest BSBR policy is the strongest leverage point for ESG in the category of trailers over 10 years horizon. The article adds to the knowledge of impact of ESG on firm values and for the first time takes the Nifty 100 firms and categorizes them to identify firms which lag in implementing the ESG parameters. The article helps practitioners and policy makers focus on how to improve on ESG parameters. Our work also adds ont to the stakeholder theory, resource based view and institutional theory.