ESG Performance and Risk Management: An Overview of European Corporate Sector in Times of Uncertainty

In the context of global economic volatility and recent geopolitical reconfigurations, the present study investigates the relationship between risk management and ESG performance among publicly listed companies in Europe. The research adopts a quantitative approach, using a sample of 4,624 observations covering the period 2020-2025, characterized by increased economic instability. The data is extracted from the Thomson Reuters database and analyzed using descriptive statistics and linear regression, performed with IBM SPSS. ESG performance is considered the dependent variable, measured through an aggregated score, while risk management is proxied by risk management, measured through Tobin’s Q indicator. The model includes control variables such as financial performance, leverage, firm size, and capital structure. The results reveal the existence of a positive and statistically significant relationship between systemic risk and ESG performance, suggesting that companies with stronger financial positioning tend to exhibit a higher level of commitment to sustainability practices. In addition, financial performance and firm size positively influence the ESG score, indicating the importance of resource availability and institutional pressures in the adoption of ESG practices. Regarding capital structure of the companies, the results also indicate a strong positive impact towards the ESG performance in state-owned enterprises sector. The study contributes to the existing literature by providing recent empirical evidence on the interdependence between risk management and sustainable performance in the European corporate environment.