The Influence of Environmental, Social, and Governance (ESG) Perception on Investor Trust and Brand Relationship Quality: A Study Among Retail Investors in Hong Kong

Background/Introduction: Investor trust and brand relationship quality, along with initiatives for environmental, social, and governance (ESG), have become highly important. Despite their relevance, limited research has been conducted on how ESG initiatives influence investors’ perceptions in financ...

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Bibliographic Details
Published in:Journal of risk and financial management 2024-10, Vol.17 (10), p.455
Main Authors: Pong, Hok Ko, Man, Fion Lai Chun
Format: Article
Language:English
Subjects:
Accountability
Behavior
Brand image
Capital costs
Ethics
Financial institutions
Financial markets
Financial services
Influence
International finance
Investors
Perceptions
Reputations
Securities markets
Social responsibility
Surveys
Sustainability
Transparency
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Summary:Background/Introduction: Investor trust and brand relationship quality, along with initiatives for environmental, social, and governance (ESG), have become highly important. Despite their relevance, limited research has been conducted on how ESG initiatives influence investors’ perceptions in financial markets. Objectives/Aims: This work conducts a cross-sectional analysis to examine the relationship between perceived ESG initiatives and investor trust and brand relationship quality among retail investors in Hong Kong, one of one of the world’s leading financial markets. Methods: This study involved 479 retail investors. Three instruments were administered in the questionnaires: (1) the perceived environmental, social, and governance scale, (2) the investor trust scale, and (3) the brand relationship quality scale. Results: The analysis demonstrates that PESG and various aspects of investor trust and brand relationship quality had strong positive correlations. Notably, the environmental and social concerns of PESG were found to be strong predictors of investor trust and brand relationship quality, whereas governance awareness had the least effect. Conclusions: Improving a firm’s ESG image can boost investors’ confidence and the quality of brand relationships, thus aligning with sustainability and business strategies.
ISSN:1911-8074
1911-8066
1911-8074
DOI:10.3390/jrfm17100455