This study examines the relationship between environmental, social, and governance (ESG) risk, chaebol firms, and donation activities. Using the measure of donation expenses seen in 2010~2020 Korea Exchange-listed firms, we examine whether chaebol firms with high ESG risk engage in more donation activities for sustainable management. We find that chaebol firms exposed to ESG-related negative events reduce donation expenditure, despite the positive relation between ESG risk and donation activities in general. Moreover, the donation activities of chaebol firms have a negative effect on firm value. This indicates that the chaebol¡¯s donation activities are not an effective means for ESG risk management and do not seem to be evaluated positively in the capital market. This study points out that chaebol firms¡¯ donation activities may be a form of ¡°Korean greenwashing,¡± and it contributes to the existing literature by implying how consumers and investors should view donation activities.
environmental,social and governance (ESG) risk,corporate social responsibility (CSR),Donation activities,Sustainability management,Firm value,Greenwashing