Between green gains and growing pains: a systematic review of ESG initiatives and firm outcomes
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Issued Date
2026-04-24
Resource Type
ISSN
2049372X
eISSN
20493738
Scopus ID
2-s2.0-105039399407
Journal Title
Meditari Accountancy Research
Volume
34
Issue
2
Start Page
526
End Page
556
Rights Holder(s)
SCOPUS
Bibliographic Citation
Meditari Accountancy Research Vol.34 No.2 (2026) , 526-556
Suggested Citation
Pratoomsuwan T., Tan H.T., Wattanacharoensil W. Between green gains and growing pains: a systematic review of ESG initiatives and firm outcomes. Meditari Accountancy Research Vol.34 No.2 (2026) , 526-556. 556. doi:10.1108/MEDAR-10-2025-3356 Retrieved from: https://repository.li.mahidol.ac.th/handle/123456789/117552
Title
Between green gains and growing pains: a systematic review of ESG initiatives and firm outcomes
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Author's Affiliation
Corresponding Author(s)
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Abstract
Purpose – This study aims to explore how external drivers and environmental, social and governance (ESG) initiatives influence firms’ decisions and performance across financial and non-financial dimensions. It disentangles the various firms’ actions on ESG that constitute different types of firm-level initiatives and examines their effects on organizational outcomes. Guided by the institutional logics perspective, the study explains how these initiatives are shaped by external pressures and normative expectations and identifies how initiatives influence financial performance, non-financial performance or a combination of both. Design/methodology/approach – Drawing on 72 peer-reviewed articles published in top-tier accounting journals, this study analyzes and synthesizes the existing literature to examine firm-level ESG initiatives and their association with firms’ decisions and performance. Findings – The review identifies key external drivers and internal ESG initiatives that shape firm outcomes. State-regulatory logic, reflecting coercive pressures or regulatory mandate together with pressure from stakeholders (e.g. investors or auditors), underpins several initiatives (e.g. board characteristics, adoption of management control systems [MCS] and sustainability disclosure) that jointly influence both financial and non-financial performance. By contrast, initiatives grounded by market logic, driven primarily by competition and market forces, such as financial flexibility, tend to affect financial outcomes, while those shaped by state-regulatory logic, such as climate governance, are more closely associated with non-financial outcomes. Practical implications – By revealing tangible connections between disentangled ESG initiatives and firm decisions and performance, these insights can support more informed materiality assessments, enabling firms to prioritize ESG initiatives that align sustainability objectives with business performance goals. Originality/value – The study challenges the prevailing tendency in prior research to treat ESG as a homogeneous construct, which overlooks the distinct ways in which these dimensions shape firms’ actions. This review highlights how each ESG dimension, and their potential interplays, gives rise to specific initiatives that influence corporate behavior and outcomes differently. This paper further introduces the institutional logics perspective as a guiding lens to explain how institutional pressures at both macro and meso levels drive firms to pursue different ESG initiatives. In doing so, this research bridges fragmented literatures, brings theoretical coherence to a complex field and offers practical value by equipping firms with insights to support more informed and strategic decision-making.