Enhancing competitiveness in container shipping: the trade-off between operational performance and ESG initiatives

This study investigates the effects of environmental, social, and governance (ESG) practices on the financial and operational efficiency of international container shipping enterprises (CSEs) from 2019 to 2023. Using data envelopment analysis to measure firm efficiencies and truncated regression to examine ESG relationships, results reveal that financial efficiency improved, largely driven by technological change and favorable market conditions, while operational efficiency declined, indicating price-driven profitability gains. Scale efficiency is a key determinant of financial performance, with leading carriers achieving full efficiency and smaller firms facing persistent inefficiencies. Environmental initiatives enhance financial efficiency but reduce operational efficiency, highlighting a trade-off between long-term financial gains and short-term operational constraints. Social and governance dimensions show no significant effects, suggesting delayed or indirect impacts. The findings emphasize the need for strategically timed environmental investments, resource allocation, fleet modernization, and long-term planning of social and governance initiatives to optimize CSEs’ performance.