In the Nordic region, active divestments targeting industries deemed unsustainable or harmful have become prevalent which impact firms and investors in the current investment landscape . This study investigates the relationship between Environmental, Social, and Governance (ESG) performance and the cost of capital for Nordic listed corporations in 2023/2024. By analysing data from the Nordic region, the research aims to investigate deeper and provide insights on how ESG factors influence the cost of capital in different GICS sectors. In the study a total of 404 firms are used to investigate the relationship between cost of capital and the environmental, social and governance factors. The empirical results show that ESG score have a negative impact on weighted average cost of capital and that some sectors experience a stronger negative relationship. Furthermore, firms with higher ESG scores tend to benefit from reduced capital costs, emphasizing the importance of societal responsibilities which today is an important growing topic related to the green transition. The findings also align with the research’s set hypothesises and contribute to existing literature by providing insights to the Nordic region and more specifically industry-specific effect