Reputational Signaling through Sustainability Disclosure and Profitability in Stakeholder-Driven Markets

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

🔬研究者:Offers a case study on ESG disclosure effectiveness in an emerging market with non-significant results, useful for meta-analyses or cross-country comparisons.

🏢実務担当者:Highlights that in some markets, ESG disclosure alone may not affect stock prices, suggesting the need for complementary regulatory or incentive mechanisms.

🏛政策担当者:Provides evidence that voluntary ESG disclosure may require stronger regulatory backing and market infrastructure to influence capital allocation.

This study examines the effect of corporate sustainability practices, as measured by GRI G4-based ESG disclosure scores, on stock prices in 38 mining companies listed on the Indonesia Stock Exchange during the period 2019–2023. In addition, corporate profitability (Return on Assets/ROA) is tested as a moderating variable to see whether the level of profit strengthens or weakens the relationship between ESG and stock prices. Panel data are analyzed using pooled OLS with robust standard errors after passing a series of classical assumption tests. The regression results show that neither ESG scores nor ESG×ROA interactions have a significant effect on stock returns, and the control variables also show no significance. The model only explains 3.50% of the variation in stock returns (R² = 0.0350), indicating that the dominance of other external factors such as commodity price volatility and macroeconomic policies have not been observed in this research model. This finding confirms that ESG sustainability signals have not been fully internalized by the capital market of mining companies in Indonesia, so that strengthening regulations, fiscal incentives, and independent audits are needed to improve the effectiveness of sustainability reporting.

• openaire https://doi.org/10.56209/jommerce.v5i2.172first seen 2026-05-05 19:08:15