THE EFFECT OF ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) ON FINANCIAL PERFORMANCE WITH COMPANY SIZE AS A MODERATING VARIABLE

Rachma Dwiyanti, Anggita Langgeng Wijaya, Erma Wulan Sari

Abstract


This study aims to analyze the effect of Environmental, Social, and Governance (ESG) on firm financial performance with firm size as a moderating variable. A quantitative approach was employed using a sample of companies listed on the Indonesia Stock Exchange during the observation period. Data were collected from annual and sustainability reports and analyzed through multiple regression with an interaction test. The findings reveal that ESG has a positive impact on financial performance, as reflected in profitability ratios. However, firm size as a moderating variable indicates that only large firms are able to optimize ESG implementation to improve financial outcomes. These results suggest that the larger the firm, the more effective ESG practices are in enhancing corporate value and competitiveness. This study suggests that small and medium-sized firms should also adopt sustainable ESG practices to improve financial performance while providing long-term benefits for stakeholders.

Full Text:

PDF

References


Fransiska, W., Zefriyenni, Z., & Crefioza, O. (2025). Ukuran Perusahaan Memoderasi Pengaruh Struktur Modal dan Kinerja Keuangan Terhadap Nilai Perusahaan Manufaktur Sektor Industri Dasar dan Kimia. RIGGS: Journal of Artificial Intelligence and Digital Business, 4(1), 97–102. https://doi.org/10.31004/riggs.v4i1.377

Kusuma, M. (2021). Measurement of Return on Asset (ROA) based on Comprehensive Income and its Ability to Predict Investment Returns: an Empirical Evidence on Go Public Companies in Indonesia before and during the Covid-19 Pandemic. Ekuilibrium : Jurnal Ilmiah Bidang Ilmu Ekonomi, 16(1), 94. https://doi.org/10.24269/ekuilibrium.v16i1.3238

Kuswanto, A., Kharisma, A., & Sardiyo, -. (2025). Factors that influence on dividend policy. Conference In Business, Accounting, And Management (CBAM), 1(1), 23–33.

Naela, P., & Muhammad, A. (2024). Effect Of Environmental Performance, Environmental Costs, And Corporate Social Responsibility On Financial Performance Of Mining Companies Listed On The Indonesia Stock Exchange In 2020-2022. Jurnal Ekonomi, Volume 13. https://doi.org/10.54209/ekonomi.v13i03ESSN 2721-9879

Pramadhia, J. H., & Nainggolan, Y. A. (2025). The Role of ESG Component in Shaping Corporate Cost of Debt and Cost of Equity in Indonesia. 5(6), 1345–1357.

Rojaba, N. I., Nurhajati, & Wahono, B. (2025). Pengaruh Penerapan Environmental, Social, Dan Governance Terhadap Kinerja Keuangan Dengan Ukuran Perusahaan Sebagai Variabel Moderasi (Studi Empiris PadaPerusahaan Perbankan Yang Terdaftar Di Bursa Efek Indonesia Tahun 2019-2023). E–Jurnal Riset Manajemen, 14(01), 179–190.

Sidarta, A. L., Sukoharsono, E. G., & Laily, A. N. R. (2023). The influence of green accounting on the company profitability. Revista de Gestão e Secretariado (Management and Administrative Professional Review), 14(6), 9829–9841. https://doi.org/10.7769/gesec.v14i6.2343

Suhendry, W. (2021). Effect of Debt to Equity Ratio and Current Ratio on Company Value with Return on Assets as Intervening Variable in Consumer Goods Industrial Companies Listed on the Indonesia Stock Exchange for the 2015–2018 Period. Journal of Economics, Finance And Management Studies, 04(08), 1444–1449. https://doi.org/10.47191/jefms/v4-i8-22

Zulfa, A., & Marsono. (2023). Pengaruh Intellectual Capital, Corporate Social Responsibility, dan Good Corporate Governance Terhadap Kinerja Keuangan (Studi Empiris Pada Perusahaan Pertambangan yang Terdaftar di BEI Tahun 2016-2020). Diponegoro Journal of Accounting, 12(2), 1–13.


Refbacks

  • There are currently no refbacks.


 

 

 

 

 

 

 

Editorial Office:

Universitas PGRI Madiun

Kampus 3 Lantai 2

Fakultas Ekonomi dan Bisnis

Jl. Auri no. 14-16 Madiun