The Effect of Environmental, Social, and Governance Disclosure on Firm Value Moderated by Firm Reputation in the Consumer Cyclicals Sector During 2020–2024

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

🔬研究者:Provides empirical evidence on the ESG disclosure-firm value link in an emerging market with a moderating effect of reputation.

🏢実務担当者:Suggests that building a strong reputation amplifies the market benefits of ESG disclosure, useful for sustainability reporting and investor relations.

🏛政策担当者:Highlights the role of reputational capital in enhancing the effectiveness of disclosure regulations, relevant for designing incentives or frameworks.

Purpose - This study aims to examine the effect of Environmental, Social, and Governance (ESG) Disclosure on Firm Value with Firm Reputation as a moderating variable in companies within the Consumer Cyclicals sector listed on the Indonesia Stock Exchange during the 2020–2024 period. The study is motivated by the increasing importance of sustainability disclosure in corporate reporting and the inconsistent empirical findings regarding the relationship between ESG disclosure and market valuation. Methods - Using a quantitative research design, this study employs panel data obtained from annual reports, financial statements, and sustainability reports of 16 firms, resulting in 80 firm-year observations. Firm Value is measured using Price to Book Value (PBV), ESG Disclosure is measured based on sustainability reporting indicators, and Firm Reputation is proxied by the Corporate Image Index (CII) published by Frontier Consulting Group. The data are analyzed using panel data regression with Moderated Regression Analysis (MRA) implemented through STATA software. Findings - The results show that ESG Disclosure and Firm Reputation simultaneously have a positive and significant effect on Firm Value, with the regression model showing a Wald chi-square value of 6424.24 and a probability of 0.0000. Partially, ESG Disclosure has a positive and significant effect on Firm Value (β = 1.7108; p = 0.001), while Firm Reputation also demonstrates a positive and significant influence (β = 1.0053; p = 0.000). Furthermore, the interaction term between ESG Disclosure and Firm Reputation is positive and significant (β = 0.6713; p = 0.016), indicating that Firm Reputation strengthens the relationship between ESG Disclosure and Firm Value. Research Implication - The findings imply that sustainability disclosure becomes more effective in enhancing market valuation when supported by strong reputational capital. However, this study is limited to firms within the Consumer Cyclicals sector and relies on secondary data sources, which may restrict generalizability across industries. Originality - The originality of this study lies in integrating ESG disclosure, reputational capital, and market valuation within a moderating framework in an emerging market context, offering insights for corporate managers and investors in aligning sustainability strategies with long-term value creation.

• semanticscholar https://doi.org/10.66053/ijota.v4i1.344first seen 2026-05-15 18:24:43 · last seen 2026-06-15 05:27:10
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