A Legal Origins Perspective on ESG Ratings Disagreement
Barbara Kurbus  1@  , Vasja Rant  2  
1 : Money and Finance Department
2 : Money and Finance Department

Environmental, social, and governance (ESG) scores of firms vary significantly across different rating providers. This article considers the Legal origins theory as a potential factor influencing ESG disagreement. By comparing ESG scores from five reputable ratings providers for a sample of 2,392 public firms across 53 countries, we find that “dispersion disagreement” among rating providers is lower for firms incorporated in common law countries, while “correlation disagreement” is lower for firms incorporated in common law countries. This suggests, firstly, that firms in common law countries engage in more independent and firm-specific ESG efforts, resulting in lower ESG dispersion, and secondly, that firms in civil law countries are influenced more by common factors such as national regulations and industry practices, leading to higher correlation in ESG scores between rating providers.


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