Impact of ESG Ratings on the Performance of S&P 100 Firms

Divye Sitlani

doi:10.46609/IJSSER.2026.v11i08.027

Title: Impact of ESG Ratings on the Performance of S&P 100 Firms
Authors: Divye Sitlani
Journal: International Journal of Social Science and Economic Research (IJSSER) ISSN: 2455-8834 Volume: 11 Issue: 8 Publication Date: August 2026 DOI: 10.46609/IJSSER.2026.v11i08.027
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Divye Sitlani Jumeirah College, Dubai
MLA 8 Sitlani, Divye. "Impact of ESG Ratings on the Performance of S&P 100 Firms." Int. j. of Social Science and Economic Research, vol. 11, no. 8, Aug. 2026, pp. 4042-4055, doi.org/10.46609/IJSSER.2026.v11i08.027. Accessed Aug. 2026. APA 6 Sitlani, D. (2026, August). Impact of ESG Ratings on the Performance of S&P 100 Firms. Int. j. of Social Science and Economic Research, 11(8), 4042-4055. Retrieved from https://doi.org/10.46609/IJSSER.2026.v11i08.027 Chicago Sitlani, Divye. "Impact of ESG Ratings on the Performance of S&P 100 Firms." Int. j. of Social Science and Economic Research 11, no. 8 (August 2026), 4042-4055. Accessed August, 2026. https://doi.org/10.46609/IJSSER.2026.v11i08.027.
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ABSTRACT: This paper examines the relationship between ESG ratings and the financial performance of S&P 100 firms from 2021 to 2025. This study uses pooled OLS regression on Bloomberg Terminal data, regressing Return on Equity against ESG Score, Net Debt/Equity, and Tobin's Q across 447 firm-year observations from 100 of the United States largest publicly listed companies. ESG Score is positively linked to ROE but not statistically significant (? = 3.740, p = 0.268). Net Debt/Equity (? = 28.899, p < 0.001) and Tobin's Q (? = 4.166, p < 0.001) are both significant. The regression model explains 41.7% of the variance in ROE (R² = 0.4174, F = 105.82). Bloomberg's ESG rating measures how broadly a firm reports on ESG topics, not how it performs on them. No measurable improvement in ROE is found from higher Bloomberg ESG scores in the S&P 100 over this period. Existing literature in this area predominantly uses the S&P 500, Refinitiv or MSCI scores, and data ending before 2021. This paper differs from prior literature in that it uses the S&P 100, Bloomberg's composite, the 2021–2025 period, and ROE rather than ROA.

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