Bridging the ESG data gap: transparent metrics and rankings for emerging financial markets

QACHACH, AZHAR RIM; El Mahrad, Badr; Kharbouch, Omar; Moumen, Aniss; Aoufi, Sara El; Gueddari, Manal El; Abdallah-Ou-Moussa, Soukaina

http://hdl.handle.net/10400.1/28101

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Authors

Abdallah-Ou-Moussa, Soukaina

Abstract(s)

Environmental, Social, and Governance (ESG) performance has become a pivotal driver of firm valuation, investment flows, and capital market stability and a critical dimension of corporate sustainability and investor decision-making. Yet, emerging markets face structural barriers to standardized ESG measurement due to limited data availability and inconsistent disclosures. This study addresses this gap by developing a simplified, transparent and indicator-based ESG assessment model tailored to the Moroccan capital market using publicly available data from 20 companies listed in the MASI ESG Index on the Casablanca Stock Exchange. The framework evaluates 12 equally weighted indicators across environmental, social, and governance pillars, and employs the Technique for Order Preference by Similarity to Ideal Solution (TOPSIS), a Multi-Criteria Decision-Making (MCDM) method, to generate firm-level ESG scores and rankings. In addition to equal-weighted rankings, the model was stress-tested using entropy-based and expert-informed weights. Results reveal a wide disparity in ESG maturity: while environmental reporting is relatively advanced, social and governance disclosures lag behind. Top-ranking firms align closely with international frameworks such as GRI, whereas others lack fundamental transparency. By offering a replicable, low-data ESG scoring method applicable to other emerging markets, this research provides actionable insights for investors, regulators, and corporate leaders. The findings contribute to the financial literature on ESG integration, support the design of sustainable investment strategies, and advance policy efforts to strengthen capital market resilience across the MENA region.

Keywords

ESG performance Emerging markets Morocco MASI ESG index Multi-criteria decision making (MCDM) TOPSIS Corporate sustainability Non-financial disclosure