Resumen

RODRIGUEZ AROCHA, Martha  y  VARGAS, Carlos. Sustainability Practices in Latin America: Does ESG Reduce the Cost of Capital?. The Anáhuac j. [online]. 2025, vol.25, n.2, e3019.  Epub 26-Ene-2026. ISSN 2683-2690.  https://doi.org/10.36105/theanahuacjour.2025v25n2.3019.

This article examines the relationship between Environmental, Social, and Governance (ESG) performance and the cost of capital in a sample of public companies from Argentina, Brazil, Chile, Colombia, Mexico, and Peru. The panel data regressions focus on 181 entities from 2015 to 2023. Moreover, an analysis that includes the combined and pillar scores as independent variables explores the dynamics of the ESG dimensions across different capital sources. The regression estimations with economic sector and year fixed effects highlight that ESG performance reduces the cost of capital and its stock component. Specifically, environmental and social categories drive a lower cost for both. The findings confirm that ESG practices are drivers of a lower cost of capital and cost of equity, creating long-term value in the Latin American region.

Palabras llave : ESG performance; cost of capital; Latin America; ESG pillars; sustainability; C33; C58; G32; G41.

        · resumen en Español     · texto en Inglés     · Inglés ( pdf )