In the article, we provide an original linkage between the corporate environmental, social, and governance (ESG) rating and the cost of internal control system (ICSC) stemmed from two closely related frameworks: the 2017 CoSO Framework, which calls to strengthen internal control systems to integrate ESG issues, and the EU directive on nonfinancial reporting (2014/95/EU) that entered into force in 2017. Thus, we evaluate both introductions showing ESG integration in the internal control activities. We cover firms listed on Milan Exchange from 2016 to 2019, providing a thorough analysis with robustness tests. The findings imply that firms should consider both ESG rating and the internal control system cost as strategic corporate tools for value enhancement; therefore, companies should allocate the resources appropriately to internal control activities to incorporate ESG issues and create value since internal control provides the first assurance for ESG integration. The limitations of this study pave the way for further research directions; incorporating the new amendment of the EU directive on nonfinancial disclosure, allowing for a better valuation creation assessment; and whether there is a substitution between sustainability performance and other corporate issues such as taxes and marketing expenditure.

中文翻译：

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保证需求：内部控制系统是否整合了环境、社会和治理因素？

在本文中，我们提供了企业环境、社会和治理 (ESG) 评级与内部控制系统成本 (ICSC) 之间的原始联系，这些联系源自两个密切相关的框架：2017 年 CoSO 框架，该框架呼吁加强内部控制整合 ESG 问题的系统，以及 2017 年生效的欧盟非财务报告指令 (2014/95/EU)。因此，我们评估了两个介绍，显示 ESG 整合到内部控制活动中。我们涵盖了 2016 年至 2019 年在米兰交易所上市的公司，通过稳健性测试提供全面分析。研究结果表明，企业应将 ESG 评级和内部控制系统成本视为企业价值提升的战略工具；所以，内部控制是ESG整合的第一道保障，因此企业应将资源适当分配到内部控制活动中，以纳入ESG议题并创造价值。本研究的局限性为进一步的研究方向铺平了道路；纳入欧盟非财务披露指令的新修正案，允许更好的估值创造评估；以及可持续性绩效与税收和营销支出等其他公司问题之间是否存在替代关系。允许更好的估值创造评估；以及可持续性绩效与税收和营销支出等其他公司问题之间是否存在替代关系。允许更好的估值创造评估；以及可持续性绩效与税收和营销支出等其他公司问题之间是否存在替代关系。