ABSTRACT
This study conducts a comprehensive examination of the relationships between strategic investors, financial sanctions, and ESG performance in non-financial Chinese firms from 2011 to 2022. Using data from ASSET4 and the Global Sanction Database (GSDB), the study reveals that government and foreign investors significantly promote ESG performance, while family investors have a negative impact. Moreover, the findings show distinct responses among government, foreign, and family investors when confronted with financial sanctions. Specifically, both foreign and family investors demonstrate an increased engagement in CSR activities during these periods. Conversely, government investors are linked to a decrease in ESG performance amidst financial sanctions. The results make significant contributions to the fields of ownership literature, agency theory, and sanctions literature. Additionally, they provide practical implications for diverse stakeholders, including investors, managers, and policymakers.
