To what extent do ESG transparency through CSRD disclosure influence investors' risk perception?

Dulaunoy, Florian
(2025)

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Supervisors
Postaire, Maxence
Faculty
Louvain School of Management
Degree label
Master [120] : ingénieur de gestion, à finalité spécialisée
Abstract
enThis thesis explores how ESG transparency, as imposed by the Corporate Sustainability Reporting Directive (CSRD), influences investors’ risk perception. Drawing on theories of stakeholder legitimacy and risk psychology, the study examines the role of CSRD compliance, non-financial disclosure transparency, and investors’ ESG sensitivity. Using a fuzzy-set Qualitative Comparative Analysis (fsQCA) based on survey data from 76 investors, the results reveal that risk perception is shaped by complex combinations of these factors. High ESG sensitivity combined with low transparency or compliance increases perceived risk, whereas strong compliance with low ESG sensitivity reduces it. The findings highlight the central role of ESG sensitivity and underscore the importance of aligning sustainability practices with investor expectations to mitigate perceived financial risk.