The Impact of ESG on the Capital Structure of Technology companies in the United States of America

Abstract

This research seeks to examine the relationship between Environmental, Social, and Governance (ESG) disclosures and the capital structure of U.S. technology companies listed on Nasdaq from 2019 to 2021. To address industry specificity, we divided ESG score into three categories: Environmental, Social and Governance and analyzed their impact on capital structure in terms of leverage. By analyzing financial and non-financial data sourced from Bloomberg for 98 tech companies, the study aims to determine if there’s a correlation between ESG disclosures and heightened or diminished leverage within a company’s capital structure. Our results aim to offer key insights to stakeholders, ranging from investors to policymakers, on how sustainability measures might impact the financial choices within the technology sector.