We investigate the impact of mandatory environmental, social, and governance (ESG) disclosures on real investment efficiency, measured as the sensitivity of corporate investment to Tobin’s q. Using a dataset including firms in 61 countries and a difference-in-differences framework, we document an increase in investment-q sensitivity following the adoption of ESG disclosure regulations. This association is more likely due to managerial learning from the market than other alternative explanations. Our analysis shows that mandatory ESG disclosures lead to a higher probability of informed trading and greater incorporation of earnings information into prices before public announcements, consistent with prices being more informative to managers due to the crowding in of external information gathering after the non-financial disclosure mandates. Further, we find that the enhanced investment-q sensitivity is more pronounced in firms and industries where learning is more likely to be stronger. Overall, our evidence supports the view that mandatory ESG disclosures positively affect the real economy.