Environmental, social, and governance (ESG) performance and earnings management: evidence from the brazilian stock market

Autores

DOI:

https://doi.org/10.21680/2176-9036.2026v18n1ID42509

Palavras-chave:

ESG; Earnings Management; Brazilian Stock Market.

Resumo

Purpose: The objective of this study is to analyze the influence of Environmental, Social, and Governance (ESG) performance on earnings management in the Brazilian stock market.

Methodology: Using a sample of 717 observations from 96 companies listed on Bolsa, Brasil, Balcão (B3) from 2010 and 2022, earnings management was estimated through two methods: accrual-based (EM-A) and real activities-based earning management (EM-R). ESG performance was measured using the LSEG Data & Analytics platform score, which applies a proprietary methodology to rate companies on a scale from 0 to 100. The econometric analysis was conducted using Ordinary Least Squares (OLS) with robust standard error corrections and fixed effects for year and sector.

Results: The findings indicate ESG performance does not influence earnings management overall. However, when breaking down the ESG components, corporate governance shows a significant negative effect on EM-A, indicating that stronger corporate governance reduces incentives to manipulate accounting earnings. Additionally, social performance has a significant negative impact on EM-R, suggesting that higher corporate social responsibility reduces earnings manipulation through real activities.

Contributions of the Study: Thus, the study seeks to provide support for governments to develop public policies and regulatory mechanisms aimed at transparency and sustainability; for companies to improve their governance and compliance systems; and for investors to incorporate ESG criteria into their decisions, contributing to the mitigation of conflicts of interest in the market.

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Biografia do Autor

Jocykleber Meireles de Souza, State University of Paraíba (UEPB).

PhD Candidate in Accounting Sciences at the Federal University of Paraíba (UFPB). Master in Accounting Sciences from the Federal University of Rio Grande do Norte (UFRN). Bachelor’s degree in Accounting Sciences from the Federal University of Paraíba (UFPB). Faculty Member at the State University of Paraíba (UEPB).

Vanessa Câmara de Medeiros Fernandes, Federal University of Paraíba - UFPB

PhD Candidate in Accounting Sciences at the Federal University of Paraíba (UFPB). Master in Accounting Sciences from the Federal University of Rio Grande do Norte (UFRN). Bachelor’s degree in Accounting Sciences from the Federal University of Rio Grande do Norte (UFRN).

Camilla Araújo Amaral Duarte, Federal Rural University of the Semi-Arid Region (UFERSA).

Master’s Student in Administration at the Federal Rural University of the Semi-Arid Region (UFERSA). Postgraduate in Accounting and Tax Planning from the Federal Rural University of the Semi-Arid Region (UFERSA). Bachelor’s degree in Accounting Sciences from the Federal Rural University of the Semi-Arid Region (UFERSA).

Allisson Silva dos Santos, Federal University of Paraíba

PhD Candidate and Master in Administration at the Graduate Program in Administration (PPGA) of the Federal University of Paraíba (UFPB). Specialist in Active Methodologies from the Federal University of Vale do São Francisco (UNIVASF). Bachelor in Administration from the Federal Institute of Education, Science and Technology of Paraíba (IFPB). Bachelor’s degree in Internet Systems from UniCesumar. Faculty Member at the State University of Paraíba (UEPB).

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Publicado

05-01-2026

Como Citar

Souza, J. M. de, Fernandes, V. C. de M., Duarte, C. A. A., & Santos, A. S. dos. (2026). Environmental, social, and governance (ESG) performance and earnings management: evidence from the brazilian stock market. REVISTA AMBIENTE CONTÁBIL - Universidade Federal Do Rio Grande Do Norte - ISSN 2176-9036, 18(1). https://doi.org/10.21680/2176-9036.2026v18n1ID42509

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v. 18 n. 1 (2026): Jan./Jun.

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Seção 7: Internacional (S7)

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