The Influence of ESG Disclosure on Stock Prices of Banking Companies

Unofficial AI-generated summary based on the public title and abstract. Not an official translation.

🔬研究者:Provides empirical evidence on ESG disclosure value relevance in an emerging market banking sector.

🏢実務担当者:Suggests that for banks in markets with low ESG awareness, differentiation in disclosure may be key.

🏛政策担当者:Indicates that mandatory ESG disclosure alone may not influence market prices unless accompanied by investor education.

This study aims to examine the effect of Environmental, Social, and Governance (ESG) disclosure on stock prices of banking sector companies listed on the Indonesia Stock Exchange (IDX) during the 2021–2025 period. The study is grounded in signaling theory, which suggests that non-financial information can be used by companies to convey quality and future prospects to investors. A quantitative approach was employed using panel data regression analysis, with the sample selected through purposive sampling. The independent variables consist of environmental, social, and governance disclosure, while the dependent variable is stock price. The results indicate that ESG disclosure does not have a significant effect on stock prices in the banking sector, either partially or simultaneously. These findings suggest that ESG information has not yet demonstrated strong value relevance in investment decision-making within the banking industry, as investors tend to prioritize financial information over non-financial disclosures. Furthermore, ESG disclosure in Indonesian banking remains largely compliance-driven and relatively homogeneous across firms. This study provides implications for banking companies to enhance the quality and differentiation of ESG disclosure and serves as a reference for future research.

• semanticscholar https://doi.org/10.38035/dijefa.v5i6.6235first seen 2026-07-18 07:37:55