Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024)

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ESG Performance on Corporate Financial Outcomes: Evidence from Indonesian Firms in the SRI-KEHATI Index

Authors
Anas Iswanto Anwar1, *, Fakhrul Indra Hermansyah1, Naufal Muhammad Aksah1, Ihya’ Ulumuddin1
1Hasanuddin University, Makassar, Indonesia
*Corresponding author.
Corresponding Author
Anas Iswanto Anwar
Available Online 30 July 2025.
DOI
10.2991/978-94-6463-758-8_218How to use a DOI?
Keywords
ESG Performance; Corporate Financial Performance; Return on Assets; Sustainability; GDP Growth
Abstract

This study explores the relationship between Environmental, Social, and Governance (ESG) performance and corporate financial performance in Indonesia, focusing on publicly listed companies included in the SRI-KEHATI Index. Using panel data from 10 firms over the period from 2015 to 2020, the research employs a multiple regression model to assess the impact of ESG performance on Return on Assets (RoA), with leverage, industry sector, and GDP growth as control variables. The findings reveal a statistically significant positive relationship between ESG performance and financial performance, indicating that firms with stronger ESG practices tend to achieve higher profitability. Additionally, leverage and industry sector are identified as important determinants of financial performance, with capital structure and sector-specific factors significantly influencing corporate profitability. Although the study provides meaningful insights, it acknowledges limitations such as the small sample size and the binary measure of ESG performance. Future research should focus on more granular ESG metrics and larger sample sizes to enhance the robustness of the findings. The results offer valuable implications for investors and policymakers, underscoring the importance of integrating ESG considerations into corporate strategy to drive financial success and promote sustainable development.

Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024)
Series
Advances in Economics, Business and Management Research
Publication Date
30 July 2025
ISBN
978-94-6463-758-8
ISSN
2352-5428
DOI
10.2991/978-94-6463-758-8_218How to use a DOI?
Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Anas Iswanto Anwar
AU  - Fakhrul Indra Hermansyah
AU  - Naufal Muhammad Aksah
AU  - Ihya’ Ulumuddin
PY  - 2025
DA  - 2025/07/30
TI  - ESG Performance on Corporate Financial Outcomes: Evidence from Indonesian Firms in the SRI-KEHATI Index
BT  - Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024)
PB  - Atlantis Press
SP  - 2695
EP  - 2706
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-758-8_218
DO  - 10.2991/978-94-6463-758-8_218
ID  - Anwar2025
ER  -