OTAKE Toshitsugu    Department   Ritsumeikan Asia Pacific University  College of International Management    Position   Professor
Language	English
Publication Date	2026
Type	Research paper
Peer Review	Peer reviewed
Title	Bridging ESG and Financial Performance: Financial Risk as Mediator in the MENA Region
Contribution Type	Joint Work
Journal	Afro-Asian J. of Finance and Accounting
Journal Type	Another Country
Volume, Issue, Page	16(5),pp.703-731
Details	This paper aims to investigate how ESG performance affects the financial performance of non-financial firms in the MENA region and to analyse the mediating role of financial risk in this relationship. OLS regression models were developed using a panel dataset of 522 firm-year observations during 2013-2022. The results showed that ESG has a significant impact on the financial performance of firms. Additionally, the results revealed a competitive partial mediation of financial risk in the ESG-FP nexus. Additional path analysis and robustness checks were performed. This research contributes to the existing literature using data retrieved from the Thomson Reuters database and examining the mediating role of financial risk in the hypothesised nexus in the MENA region context. Our results imply that firms must consider the possibility of bankruptcy before commencing any sustainable initiatives as it will in turn affect their financial performance.
DOI	10.1504/AAJFA.2025.10070064