The efficiency of labor investment is not only the core issue concerning the efficiency of resource allocation in macroeconomic development but also the key factor affecting the sustainable development potential of enterprises. The decision-making and practice of enterprises in labor investment not only create value for employees at the economic level but also involve considerations of their social responsibility and environmental sustainability. In recent years, with the transformation of China’s economic development mode and the steady advancement of the “double carbon” strategy, the overall performance of enterprises in three key areas of environmental protection, social responsibility, and corporate governance has attracted more and more attention from investors. This has had a lasting impact on their operational management and development quality. However, at this stage, the research on how ESG performance affects the efficiency of labor investment in enterprises needs to be supplemented. Based on this, this paper selects the panel data of Shanghai and Shenzhen A-share listed companies from 2009 to 2022, constructs an investment efficiency model to measure labor factors, and examines its specific impact on labor investment efficiency and its internal mechanism based on the characteristics of enterprises in multiple dimensions of environment, society, and corporate governance. It is found that ESG performance can effectively improve the efficiency of labor investment in enterprises, and reducing agency costs and improving the quality of analysts’ predictions are the main pathways through which ESG performance affects the efficiency of labor investment in enterprises. Heterogeneity analysis shows that the enhancement effect of ESG performance on labor investment efficiency is more significant in enterprises with higher information disclosure quality and labor intensity. Furthermore, ESG performance can effectively restrain both excessive and insufficient labor investment by enterprises, mainly manifested in mitigating over-employment and under-employment. Compared with the previous literature, the marginal contributions of this paper are as follows: First, we study the impact of ESG performance on enterprise labor investment efficiency from the perspective of sustainable development, which not only supplements the relevant literature on the influencing factors of enterprise labor investment efficiency but also enriches the relevant research in the fields of labor economics and environment, society, and corporate governance in theory. Secondly, this paper expands the literature on the economic consequences of ESG performance. Existing studies focus on the economic consequences of ESG performance from the aspects of financing cost, financial performance, and capital investment efficiency, with few studies incorporating ESG principles into labor investment decisions. Therefore, this paper focuses on the micro perspective of labor investment efficiency and systematically investigates the impact of ESG performance on labor resource allocation, which is helpful for the market to understand the significance of ESG performance at the micro level for the high-quality development of enterprises in time. Furthermore, to a certain extent, it reveals and verifies the potential mechanism by which ESG performance enhances enterprises’ labor investment efficiency. This not only provides strong evidence for how ESG performance can help enterprises optimize human capital allocation, but also provides a brand-new research perspective and ideas for follow-up research. Finally, based on three new perspectives of information disclosure quality, labor intensity, and specific types of inefficient labor investment, this paper analyzes the heterogeneity of the effect of ESG performance on labor investment efficiency, which helps to more effectively utilize the governance effect of ESG performance to improve the efficiency of labor investment in enterprises, and further expands the research perspective on the relationship between ESG performance and internal management behavior of enterprises.