The Integration of ESG Criteria as a Key Determinant in Financial Performance within Emerging Markets: A Case Study of Moroccan Enterprises

This study examined the impact of adopting environmental, social, and governance (ESG) criteria on the financial performance of Moroccan companies. It attempted to verify, both theoretically and empirically, the absence and/or presence of a consensus on the nature of the relationship between the ESG criteria and the financial performance of companies. It hypothesised that, when companies adopt ESG criteria, it affects positively its financial performance. This study hypothesised a positive relationship between a company's adoption of ESG criteria and its financial performance. Additionally, it proposed that factors such as the presence of a corporate social responsibility department, integration of ESG risks, ESG reporting, and corporate social responsibility/sustainability training sessions act as moderators in this relationship. A sample of 88 Moroccan companies, spanning various sectors (34 in the industrial sector, 30 in services, 18 in trade and distribution, and 6 in new technologies), was surveyed between May 2023 and August 2023. The results of the moderating variables, which include the existence of a department in charge of corporate social responsibility, integration of ESG risks, ESG reporting, and corporate social responsibility/sustainability training sessions, underscore the importance of implementing ESG practices as a means to positively influence companies' financial performance, suggesting potential avenues for organisations to enhance their sustainability efforts for improved financial outcomes.