Exploring the impact of ESG controversies on private hospital performance in China.

This study aims to investigate the impact of environmental, social, and governance (ESG) controversies on the performance of private hospitals in China during 2012 to 2023. ESG controversies are measured by the number of ESG controversial issues, private hospital performance is measured by return on assets and return on equity, and fixed effects models are employed. The empirical results reveal that ESG controversies have a negative impact on private hospital performance. This finding is still robust after a series of robustness checks. In addition, heterogeneous analysis shows that this impact is more prominent in hospitals that carry out digital transformation, before and after COVID-19, and in China's eastern regions. This study will help hospital managers to improve ESG performance and hospital performance through avoiding controversial issues in today's competitive environment.