The Impact of ESG Information Disclosure Quality on Investor Decision-making: An Analysis Based on Behavioral Finance Theory

School of International education, Hubei University of Economics, Wuhan, 430205, China

^* Corresponding author: xrz135790@outlook.com

Abstract

Driven by the deep penetration of global sustainable development concepts and the significant enhancement of investors’ responsibility awareness, ESG information disclosure has gradually become a key determinant in the capital market resource allocation mechanism. It is noteworthy that the heterogeneous characteristics of current ESG information disclosure quality are remarkably prominent. Coupled with the continuous impact of information asymmetry, it substantially interferes with the effectiveness of investors’ decision-making behavior. Existing research lacks a systematic exploration of the transmission mechanism of investors’ psychological biases from the perspective of behavioral finance theory. This study constructs an “information quality - cognitive bias - decision behavior” transmission model based on behavioral finance theory. It is found that ESG information disclosure quality adjusts investors’ cognitive biases through completeness and timeliness, drives decision behavior through emotional accounts and social preference mechanisms, and demonstrates significant quantitative characteristics of behavioral biases in market empiricism. Meanwhile, it points out the challenges of existing research in terms of standard systems, technical applications, and theoretical integration, and proposes breakthrough paths of intelligent disclosure technology optimization, cognitive training intervention, and policy framework design, providing support for deepening ESG investment cognition and improving the disclosure system.