This study examines the relationship between ESG scores and financial performance in Brazilian public companies, focusing on the cost of capital and return on assets (ROA). Using data from 99 Brazilian publicly traded companies between 2018 and 2022, the research tests two hypotheses: (1) ESG scores are negatively associated with the cost of capital, and (2) ESG scores are positively associated with ROA. The study employs panel regression and quantile regression analyses, controlling for fixed effects, to assess the impact of ESG practices on financial performance. The findings reveal that higher ESG scores are linked to lower cost of capital and better operating performance. Specifically, environmental performance had a statistically significant negative impact on the cost of capital, while social and governance scores were positively associated with operational performance. The results support the hypothesis that ESG practices can reduce capital costs and enhance financial performance. Additionally, the study highlights that ESG scores have a positive relationship with ROA, indicating that companies with better ESG performance tend to achieve higher operational efficiency. The study also identifies that the impact of ESG scores varies across different quantiles of the distribution, suggesting heterogeneous effects. While the overall relationship between ESG scores and financial performance is positive, there is variation in the magnitude of these effects depending on the company's performance level. The results contribute to the growing body of literature on ESG practices and their financial implications, particularly in the Brazilian context, where ESG integration is increasingly valued by investors and companies. The study underscores the importance of ESG practices in shaping financial performance and cost of capital, providing insights for investors, managers, and regulators. It also highlights the need for standardized ESG metrics and clearer regulatory frameworks to enhance the reliability and comparability of ESG assessments. Overall, the research supports the notion that sustainable practices can lead to financial benefits, reinforcing the role of ESG in corporate strategy and investment decisions.This study examines the relationship between ESG scores and financial performance in Brazilian public companies, focusing on the cost of capital and return on assets (ROA). Using data from 99 Brazilian publicly traded companies between 2018 and 2022, the research tests two hypotheses: (1) ESG scores are negatively associated with the cost of capital, and (2) ESG scores are positively associated with ROA. The study employs panel regression and quantile regression analyses, controlling for fixed effects, to assess the impact of ESG practices on financial performance. The findings reveal that higher ESG scores are linked to lower cost of capital and better operating performance. Specifically, environmental performance had a statistically significant negative impact on the cost of capital, while social and governance scores were positively associated with operational performance. The results support the hypothesis that ESG practices can reduce capital costs and enhance financial performance. Additionally, the study highlights that ESG scores have a positive relationship with ROA, indicating that companies with better ESG performance tend to achieve higher operational efficiency. The study also identifies that the impact of ESG scores varies across different quantiles of the distribution, suggesting heterogeneous effects. While the overall relationship between ESG scores and financial performance is positive, there is variation in the magnitude of these effects depending on the company's performance level. The results contribute to the growing body of literature on ESG practices and their financial implications, particularly in the Brazilian context, where ESG integration is increasingly valued by investors and companies. The study underscores the importance of ESG practices in shaping financial performance and cost of capital, providing insights for investors, managers, and regulators. It also highlights the need for standardized ESG metrics and clearer regulatory frameworks to enhance the reliability and comparability of ESG assessments. Overall, the research supports the notion that sustainable practices can lead to financial benefits, reinforcing the role of ESG in corporate strategy and investment decisions.