The influence of ESG risks on corporate governance rating

This chapter aims to achieve two key objectives. First, it incorporates Environ-mental, Social, and Governance (ESG) factors—particularly those related to ESG risks—into a national Corporate Governance Rating (CGR) model. Second, it as-sesses the model’s applicability to a sample of innovative national startups. The findings demonstrate that integrating ESG aspects into the CGR model not only enhances its comprehensiveness, innovation, and analytical depth but also helps to identify gaps in its metrics when applied to startups. The analysis reveals higher overall scores with the inclusion of ESG factors, particularly in areas such as shareholder protection, risk appetite evaluation, executive remuneration plans, and compliance with gender quotas in management and control bodies, all of which represent significant improvements in corporate communication and gov-ernance practices.