Amidst the growing attention to ESG from investors, an important factor that cannot be overlooked is whether there is a tangible correlation between ESG ratings and a company's operational performance or stock price. This correlation determines whether incorporating ESG performance into investment decisions is a wise choice or merely superfluous. The impact of ESG ratings on firms has been widely studied by scholars (as detailed in subsequent sections). Therefore, this paper extends current research by focusing on the mechanism of the relationship between ESG, corporate innovation capability, and stock price synchronicity. Tseng (2022) identified that the existence of technological spillover effects could lead to large-scale technological upgrades of equipment by many companies over a period, converting risks related to new technologies from firm-specific risks to systemic risks. Consequently, companies with higher levels of technological spillover might exhibit greater stock price synchronicity. Additionally, numerous studies suggest a close connection between ESG ratings, corporate innovation capabilities, and stock price synchronicity. This paper aims to delve deeper into this relationship and explore the underlying mechanisms.