Environmental, Social, and Governance (ESG) Controversy: Tinjauan Sistematis Determinan Tata Kelola dan Konsekuensi Korporasi

Yolanda Pratami; Raja Ade Fitrasari Mochtar; Amir  Hamzah

doi:10.33395/owner.v10i4.3528

Authors

Yolanda Pratami
✉ Corresponding author: yolandapratami3@eco.uir.ac.id Universitas Islam Riau
Raja Ade Fitrasari Mochtar Universitas Islam Riau
Amir Hamzah Universitas Kuningan

DOI:

https://doi.org/10.33395/owner.v10i4.3528

Keywords:

corporate governance; ESG controversy; firm performance; sustainability risk; systematic literature review.

Abstract

This study systematically synthesizes the literature on Environmental, Social, and Governance (ESG) controversy by examining its determinants, corporate consequences, thematic evolution, and emerging research directions. Using a Systematic Literature Review (SLR) approach based on PRISMA guidelines, this study analyzed 42 empirical articles indexed in the Scopus database and published between 2020 and 2026. Unlike previous ESG-related reviews that mainly focus on ESG performance and sustainability disclosure, this review specifically integrates the determinants and consequences of ESG controversy at the firm level within governance and sustainability contexts. The findings indicate that corporate governance mechanisms, firm characteristics, ESG disclosure practices, industry sensitivity, and institutional environments are the main factors influencing controversy exposure, with board independence, gender diversity, and ownership structure emerging as the most influential governance mechanisms. The review further reveals that controversy exposure generates multidimensional consequences, including lower financial performance and firm value, higher financial risk, reputational damage, and negative market reactions. The study contributes theoretically by providing an integrated understanding of how governance mechanisms and contextual factors shape sustainability-related corporate risks. This review also identifies research gaps related to measurement inconsistency, industry-specific contexts, and cross-country governance differences. However, this study is limited to Scopus-indexed empirical articles and may not fully capture findings from non-indexed literature. The findings provide practical implications for managers, investors, and policymakers in strengthening governance quality, improving ESG transparency, and mitigating sustainability-related risks.

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