Does corporate ESG news impact firm productivity?

This paper examines the relationship between ESG and firm productivity, addressing how ESG news impacts productivity across operational and financial dimensions. Using Truvalue Lab's AI-generated ESG score data, we analyze how near- and long-term ESG news scores influence key productivity indicators such as sales generation, operating costs (SG&A), and labor costs. We find that non-financial firms with positive ESG news scores experience reduced productivity, as ESG news improves sales, decreases operating costs, and increases labor costs. These findings highlight how ESG influences various operational and financial aspects of firm productivity.