Public Health Crises, the ESG Buffering Effect, and Financial Resilience of Healthcare Firms: An Empirical Study Based on Chinese A-Share Listed Companies

Résumé

Public health crises pose an extreme stress test on the financial sustainability of healthcare systems. This study uses a sample of Chinese A-share listed companies in the healthcare sector from 2015 to 2023 to systematically examine the micro-level mechanisms underlying firms’ financial resilience in the face of public health crisis shocks, with a particular focus on the buffering effects of the social and governance dimensions within environmental, social, and governance (ESG) performance. The study finds: First, the COVID-19 shock led to an average increase of 8.7 days in the accounts payable turnover days for healthcare firms and an average widening of 56.7 basis points in the spread on new debt financing, reflecting the dual pressures of tightening supply-chain credit and rising credit risk premiums. Second, firms with superior pre-crisis social responsibility performance experienced significantly smaller extensions in trade credit during the shock. This effect was particularly pronounced among firms that heavily relied on government medical insurance payments. Third, firms with higher governance transparency exhibited significantly smaller increases in spreads on additional financing during the shock; firms scoring in the 90th percentile for governance had spreads about 25 basis points lower than those at the median level. Mechanism analysis, supported by micro-level financial communication records from the major epidemic prevention and treatment base in Huludao City, reveals the specific process through which frequent information disclosure acts as a “reputational collateral” to reduce credit risk premiums. The marginal contributions of this study lie in: extending the research perspective on financial resilience from macro-fiscal transfers to stakeholder trust mechanisms at the firm level; constructing a dual resilience metric comprising both “trade credit extension” and “financing cost spreads”; and providing micro-level empirical evidence for the ESG buffering effect identified through large-sample regressions. The study’s findings offer empirical support for incorporating ESG factors into credit assessments of healthcare firms and for optimizing the management of public health emergency funds.