Environmental, social and governance (ESG) criteria mean investment in economic choices which, without interference with the environment, are intended to promote long-term economic and social well-being. Due to high environmental and social awareness, customers expect companies to devote time and efforts to such sustainable practices. This attitude has led to an overall rise in ESG disclosures and reporting instruments globally with a focus on influence of ESG disclosures on financial performance of companies. Many European countries have already introduced mandatory disclosure of non-financial information. This transition from voluntary to mandatory motivated other countries to adopt mandatory ESG disclosure practices for sustainable development. The practice of reporting non-financial disclosures has been rising due to several reasons, such as increasing visibility, informing customers, avoiding the risk associated with firm performance and achieving sustainability. Countries in the early stages of ESG disclosure need to understand the benchmark practices used by countries with a well-developed ESG system. For preparing the ESG disclosure index and benchmarking based on disclosure score, this study considers a set of developed and developing countries with their ESG disclosures. On the basis of ESG disclosures, the countries have been classified into four different categories. We found Norway, Sweden, Denmark, Finland, United Kingdom, Belgium and France, to have high ESG scores and have been classified as Countries with Well-Developed ESG Framework. Germany, Italy, USA, Australia, Switzerland, Canada, Japan, Brazil and South Africa have medium to high ESG scores and fall under the category Rapidly improving ESG framework. While Singapore, India, China, Philippines, Malaysia and Argentina are categorized as countries with ESG framework at developing stage, Russia, Indonesia, Thailand, Nigeria and Vietnam are classified as Countries with early-stage framework due to low ESG scores.
Cross-country effects and policy responses to COVID-19 in 2020: The Nordic countries
