Abstract

Against the backdrop of escalating global environmental and social challenges, enterprises are increasingly recognizing the pivotal role of Environmental, Social, and Governance (ESG) factors in their long-term competitive advantage. This paper employs a methodology combining literature review and case analysis to delve into how ESG performance acts as a catalyst for competitive advantage construction amid enterprise transformation, with a particular emphasis on the optimization of internal management and governance structures. The research reveals that by actively enhancing ESG performance, enterprises not only bolster their reputation and brand image but also steer themselves towards more sustainable and responsible business models. This shift is not merely a response to external environmental pressures but also a core driver of internal corporate transformation and upgrading. By integrating ESG strategies with their management practices, enterprises can cultivate distinctive competitive advantages, ultimately achieving enhanced sustainable development and overall competitiveness. The study provides theoretical and practical guidance for enterprises, aiding them in effectively integrating ESG factors into practice, thereby facilitating transformational development and competitiveness enhancement.

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