Analysis of Development Trends of ESG Implementation and CEO Accountability within Corporate Governance Systems of Emerging Markets
DOI:
https://doi.org/10.54097/m5wc4864Keywords:
Emerging markets, Corporate governance, ESG implementation, Senior executive performance, Duty of care, Institutional evolution.Abstract
ESG has transitioned from being a discretionary activity in affluent countries, to being a fundamental need in the global financial industry. However, emerging markets have distinct restrictions including the institutional foundation, the stakeholder structure and the compliance to international norms and their practical approaches are different from industrialised markets. This article studies the institutional context of emerging economies and the impact of ESG integration on executive accountability. The paper finds that ESG is shifting from a compliance disclosure to an integrated governance practice. The scope of executive accountability is evolving from formal compliance to substantive governance. This is illustrated by the extension of directors' duty of care to ESG-related issues, the tying of compensation to sustainable performance, the institutionalisation of stakeholder participation, and the systematic upgrading of professional capabilities. Executive responsibility is constrained externally, e.g. by the differentiation of ESG ratings, the transfer of green financing and the extraterritoriality of cross-border regulation. Based on this, the paper concludes that ESG executive accountability will tend to be more specific legal obligations, multi-dimensional evaluation indicators and wide professional competencies. The paper suggests that the enterprise in the emerging market should pay attention to the local institutional conditions while conforming to the international standards, establish the senior executive performance framework commensurate with their own development, and balance the sustainable development goals and governance efficiency. The theoretical approach of this research provides a perspective to understand the process of change, but the specific implications in different institutional contexts need to be empirically tested.
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