THE EFFECT OF OWNERSHIP STRUCTURE AND PROFITABILITY ON STOCK PRICES IN IDX ESG LEADERS

Abstract

This study aims to examine the effect of institutional ownership, managerial ownership, and profitability on stock prices of companies listed in the IDX ESG Leaders Index in Indonesia during the 2020–2024 period. The research employs a quantitative method using multiple linear regression analysis. The sample consists of 14 companies that consistently remain in the IDX ESG Leaders Index, yielding a total of 70 observations over five years. The independent variables analyzed include institutional ownership, managerial ownership, and profitability measured by Return on Equity (ROE), while the dependent variable is stock price, measured by the year-end closing price. The partial test results indicate that institutional ownership and managerial ownership have a negative and significant impact on stock prices, whereas profitability shows no significant effect. However, when tested simultaneously, all three variables are found to have a significant influence on stock prices. The coefficient of determination (R²) of 15.9% suggests that the model explains stock price variations only to a limited extent, with the remaining 84.1% influenced by external factors such as macroeconomic conditions and market sentiment. These findings provide important implications for investors, management, and regulators in formulating policies and making sustainable investment decisions.