ESG Divergence and the Inflow of High-Skilled Talent in Client Firms: Evidence from Chinese Listed Companies

High-skilled talent, as a core resource, is a key driving force for enterprises to achieve high-quality and sustainable development. Previous studies showed that ESG performance is a critical factor that impacts the inflow of high-skilled talents toward client firms. However, few studies have examined how inconsistency (divergence) in ESG performance between suppliers and client firms affects the inflow of high-skilled talent. This study uses data from Chinese listed companies and their suppliers from 2009 to 2022. It employs signaling theory and consistency theory. It explores the impact of ESG divergence between suppliers and client firms on the inflow of high-skilled talent. The perspective is dyadic supply chain relationships. The findings reveal that ESG divergence increases both reputational and operational risks for client firms, reduces operational efficiency, and thereby weakens their ability to attract high-skilled talent. However, when a client firm’s ESG performance aligns with the average ESG level of its industry or region, the negative effect of ESG divergence can be effectively mitigated. In addition, the negative effect of ESG divergence is asymmetric: when a client firm’s ESG performance is lower than that of its supplier, the detrimental impact on talent inflow is more pronounced. Furthermore, the negative influence of ESG divergence is amplified when client firms have a lower level of digital transformation, operate in highly competitive markets, or are connected to suppliers within more networked configurations. This study enriches the literature on supply chain ESG management and high-skilled talent inflow under the context of innovation-driven development. It underscores the importance of ESG signal consistency in attracting high-skilled talent. It provides practical implications for enterprises. They aim to optimize their talent structure and enhance innovation-driven growth.