ESG performance and its impact on companies' financing conditions are becoming increasingly important. Interest in how ESG performance (Environmental, Social, Governance) affects companies' cost of debt has increased. ESG ratings are used by investors and lenders as a basis for decision-making, but the relationship between ESG and the cost of debt is still unclear in the Swedish context. The purpose of this study is to describe whether there is a relationship between ESG performance and the cost of debt, and how it can help companies reduce the cost of debt. A deductive approach was used, based on signaling theory and agency theory, as well as previous research suggesting that ESG performance sends positive signals to lenders and reduces information asymmetry. The investigation was carried out using a quantitative research method. It began with a correlation analysis, and a regression analysis was conducted to confirm the result. The study shows a weak negative relationship between ESG and the cost of debt in the correlation analysis, but the relationship is not statistically significant in the regression analyses. ESG ratings are not statistically significant as a whole, nor did the individual ESG components (E, S, G) show significant results. Therefore, the effect of ESG factors in the credit granting process is currently small for Swedish listed companies.