This study reviews the literature on environmental, social and governance (ESG) factors and their impact on corporate behavior and financial performance, highlighting the challenges of standardizing ESG data and aligning regulatory efforts with market needs. Market participants use ESG information; thus, a solid framework is essential for understanding its effect on financial outcomes. The lack of standardization creates uncertainty, reduces disclosure reliability, and limits investors’ informed decision-making. This paper addresses three key themes: the impact of ESG on corporate financial performance, inconsistencies in ESG disclosures and ratings that create data ambiguity, and the influence of evolving global ESG regulations. Drawing on numerous academic articles from reputable journals covering trends in emerging and mature markets, the review employs a systematic literature review (SLR) to identify themes and gaps. Findings indicate that ESG integration generally produces positive or neutral financial outcomes, though regional differences exist, and inconsistent data affects ratings. The study contributes by examining ESG frameworks, categorizing their effects on companies and investments, and emphasizing the need for standardized ESG data to enhance transparency, reduce greenwashing, and support informed, sustainable investment decisions.