["Business Strategy and the Environment, EarlyView. ", "\nABSTRACT\nThe integration of environmental, social, and governance (ESG) factors into corporate business strategy has become progressively important, particularly for firms operating in high‐materiality industries where nonfinancial risks are more pronounced. This study examines the association between ESG performance and firm performance among European listed companies within high‐materiality industries during the period 2014–2024. Using panel data collected from established financial and sustainability databases, the analysis studies the influence of aggregate ESG scores and their individual components on key firm performance indicators, including return on assets (ROA), return on equity (ROE), and Tobin's Q. The empirical results reveal a predominantly positive association between ESG integration and firm performance, with stronger and more statistically significant effects observed for market‐based and operational performance measures. In particular, governance‐related ESG dimensions exhibit the most consistent positive influence, whereas environmental initiatives may impose short‐term financial constraints due to higher implementation costs. The findings highlight the importance of strategically embedding ESG considerations into corporate managerial procedures, especially in sectors characterized by high material exposure. This research contributes to the existing literature by emphasizing the role of industry‐specific materiality in shaping the ESG–performance relationship within the European context.\n"]