The Impact of ESG Percepition on University

During the last two decades, sustainability issues, such as climate change, depletion of natural resources, or bad working conditions, gained considerable attention in the literature. Investors, consumers, suppliers, employees, public powers, and non-governmental organisations are increasingly requiring the development and implementation of sustainable practices, considering that sustainability and environmental, social and governance (ESG) factors became drivers able to affect companies’ performance and are considered a source of competitive advantage. In the current scenario, universities play a pivotal role in the transition to a sustainable society, providing students with knowledge about sustainability, ethical values, and human rights, contributing also to the achievement of the 17 Sustainable Development Goals (SDGs) of the 2030 UN Agenda. The perception of the relevance of sustainability and ESG issues fosters the universities to make investments for organizational restructuring, adjusting planning and controls, transforming their own missions, broadening their curricula, and providing non-financial disclosure. Particularly, non-financial disclosure is a strategic tool at least for the following three main reasons: to i) affect the way they are perceived and regarded externally; ii) legitimize their business activities to stakeholders; and iii) appear as good corporate citizens. In the light of the previous considerations, this research paper tried to understand if the ESG perception can affect the performance of universities. Our analysis considered only the Italian mega-universities and was based on the ESG Perception Index for the period June-October 2021 as a tool for assessing the value of the relevance given to ESG issues by universities. This indicator was retrieved from the Reputation Science’s Report. We carried out a multi-stakeholder analysis to understand if there is a correlation between the ESG Perception Index and economic variables related to the following three categories: i) students; ii) professors; iii) the Ministry of Higher Education. The findings showed a significant positive correlation between the ESG Perception Index and the considered variables. In order to validate these results, we developed a content analysis of universities’ sustainability reports, based on the presence of keywords related to environmental, social, governance/transparency, and sustainability issues and then we used the retrieved level of non-financial disclosure as a control variable. Thus, these findings provide insight into how ESG perception can affect universities’ performance and can be useful for academic researchers, policy-makers, and practitioners.