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VOL. 11, ISSUE 5 (2024)
Does the environmental, social, and governance performance affect firm value? evidence from Indonesia
Authors
Nurul Khalishah Azzahra, Andrian Budi Prasetyo
Abstract
The purpose of this research is to examine the
effect of ESG performance on firm value from all companies listed on the IDX as
issuers regardless of sector (sector-agnostic) in Indonesia context from 2020
to 2022. This is done through investigating the influence of being listed in
the SRI-KEHATI Stock Index. Using multiple linear regression analysis, the
results showed that ESG performance has a significant positive effect on firm
value. The better the ESG performance of a company, which is represented by the
company being a member of the ESG index, the more the value of a company
increases. The competitive advantage obtained by companies involved in ESG
practices accompanied by IDX recognition as a stock market authority is
considered to trigger an increase in company value. This research contributes
to the literature by addressing the effect of ESG performance on firm value
using stock index by IDX namely SRI-KEHATI Stock Index. As an emerging market,
Indonesia is starting to recognize the value of sustainable business practices.
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Pages:138-143
How to cite this article:
Nurul Khalishah Azzahra, Andrian Budi Prasetyo "Does the environmental, social, and governance performance affect firm value? evidence from Indonesia". International Journal of Multidisciplinary Research and Development, Vol 11, Issue 5, 2024, Pages 138-143
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