The Effect of ESG on Financial Performance with Intellectual Capital as Moderating Variable
English
Abstract
This study aims to analyze the influence of Environmental, Social, and Governance (ESG) on the financial performance of manufacturing companies listed on the Indonesia Stock Exchange (IDX) for the period 2019-2023, as well as the moderating roles of Intellectual Capital. A quantitative approach was employed through secondary data documentation techniques and analyzed using panel data regression with a fixed effects model. The research sample consisted of 22 manufacturing companies. The results show that ESG disclosure has a significant influence on financial performance. Intellectual Capital also has a significant impact and positively moderates the relationship between ESG and financial performance. This research implies the importance of ESG practices and intellectual capital management as strategies to enhance the financial performance of manufacturing companies in Indonesia, particularly by strengthening internal capabilities in leveraging sustainability practices.
Downloads
References
Akbari, P. N., & Rahma, Y. (2023). The Impact of Corporate Social Responsibility Disclosure and Company Size on Company Financial Performance: The Role of Intellectual Capital as Moderating Variable. SAR (Soedirman Accounting Review): Journal of Accounting and Business, 08(01), 119–135. https://doi.org/10.32424/1.sar.2023.8.1.8618
Al-Tarawneh, A., Tayeh, M., Iskandrani, M., & Obeidat, M. (2024). The impact of ESG scores on corporate financial performance: A study of non-financial firms listed in the UK. Asian Economic and Financial Review, 14(11), 852–867. https://doi.org/10.55493/5002.v14i11.5229
Barney, J., Wright, M., & Ketchen, D. J. (2001). The resource-based view of the firm: Ten years after 1991. Journal of Management, 27(6), 625–641. https://doi.org/10.1177/014920630102700601
Candio, P. (2024). The influence of ESG score on financial performance: Evidence from the European health care industry. Strategic Change, 33(5), 417–427. https://doi.org/10.1002/jsc.2594
Charnes, A., Cooper, W. W., Lewin, A. Y., & Seiford, L. M. (1994). Data Envelopment Analysis: Theory, Methodology, and Applications. In Sustainability (Switzerland) (Issue 1). http://scioteca.caf.com/bitstream/handle/123456789/1091/RED2017-Eng-8ene.pdf?sequence=12&isAllowed=y%0Ahttp://dx.doi.org/10.1016/j.regsciurbeco.2008.06.005%0Ahttps://www.researchgate.net/publication/305320484_SISTEM_PEMBETUNGAN_TERPUSAT_STRATEGI_MELESTARI
Chen, & Xie, G. (2022). ESG disclosure and financial performance: Moderating role of ESG investors. International Review of Financial Analysis, 83(June), 102291. https://doi.org/10.1016/j.irfa.2022.102291
Cindiyasari, S. A., Junarsin, E., Mada, U. G., & Septiani, E. (2023). Does Intellectual Capital Affect Financial Performance? An Empirical Evidence from Financial Companies in Indonesia. 1888–1898. https://doi.org/10.46254/ap03.20220322
Eriany, P., & Widyawati, L. (2024). ESG and Financial Performance: The Moderating Role Of Intellectual Capital. Junal Equity, 27(2), 226–239. https://doi.org/10.4018/978-1-5225-7180-3.ch029
Freeman, R. E., & McVea, J. (1984). A Stakeholder Approach to Strategic Management. SSRN Electronic Journal, March. https://doi.org/10.2139/ssrn.263511
Gómez-Valenzuela, V. (2022). Intellectual capital factors at work in Dominican firms: understanding their influence. Journal of Innovation and Entrepreneurship, 11(1). https://doi.org/10.1186/s13731-022-00205-8
Gupta, R., Sharma, T., & Prashar, A. (2022). Social Indicators of ESG and Firm’s Financial Performance in India in Responsible Leadership for Sustainability in Uncertain Times: Social, Economic, and Environmental Challenges for Sustainable Organization. Singapore: Springer Nature Singapore, ln (pp.211-226).
Hermawan, S., Hanun, N. R., Nirwana, N. Q. S., & Candrawati, C. I. (2021). Intellectual Capital, Market Value, and Financial Performance: Indonesia and Malaysia’s Banking Companies. Journal of Accounting and Strategic Finance, 4(2), 135–151. https://doi.org/10.33005/jasf.v4i2.142
Inawati, W. A., & Rahmawati. (2023). Dampak Environmental, Social, Dan Governance (ESG) Terhadap Kinerja Keuangan. Jurnal Akademi Akuntansi, 6(2), 225–241. https://doi.org/10.22219/jaa.v6i2.26674
Lim, L. (2025). Pengaruh Harga Kualitas Produk dan Sosial Media Marketing terhadap Keputusan Pembelian Skincare Somethinc. 3(1), 258–270.
Liu, Y., Cao, J., & Zhang, Q. (2022). The product marketing model of the economic zone by the sensor big data mining algorithm. Sustainable Computing: Informatics and Systems, 36(October), 100820. https://doi.org/10.1016/j.suscom.2022.100820
Naeem, N., Cankaya, S., & Bildik, R. (2022). Does ESG performance affect the financial performance of environmentally sensitive industries? A comparison between emerging and developed markets. Borsa Istanbul Review, 22, S128–S140. https://doi.org/10.1016/j.bir.2022.11.014
Pratama, A., Pratama, B. C., Wahyuni, S., & Hapsari, I. (2024). Moderating Effect of Intellectual Capital Components on the Relationship between ESG Scores and Firm Financial Performance. Asian Journal of Economics, Business and Accounting, 24(6), 477–495. https://doi.org/10.9734/ajeba/2024/v24i61375
Pulic, A. (1998). Measuring the performance of intellectual potential in the knowledge economy. The 2nd" World Congress on the Management of Intellectual Capital", 1–20.
Purwanto, E. (2020). Pengantar Bisnis Era Revolusi Industri 4.0 Eko Purwanto.
Rahmasari, B. P., & Trisnaningsih, S. (2021). Pengaruh Gcg Terhadap Nilai Perusahaan Dengan Kinerja Keuangan Sebagai Variabel Intervening. Seminar Nasional Akuntansi Dan Call for Paper (SENAPAN), 1(1), 129–141. https://doi.org/10.33005/senapan.v1i1.234
Ramadhani, A. T., & Sulistyowati, E. (2023). Pengaruh Intellectual Capital Dan Implementasi Good Corporate Governance Terhadap Peningkatan Kinerja Keuangan. Jurnal Ilmiah Manajemen, Ekonomi, & Akuntansi (MEA), 7(2), 969–986. https://doi.org/10.31955/mea.v7i2.3091
Ren, C., Ting, I. W. K., Kweh, Q. L., & Le, H. T. M. (2024). THE DYNAMIC ROLE of INTELLECTUAL CAPITAL in MODERATING ESG PRACTICES and FINANCIAL PERFORMANCE in the CHINESE A-SHARE MANUFACTURING SECTOR. Singapore Economic Review, 1–27. https://doi.org/10.1142/S0217590824500516
Rengganis, Widarwati, E., Nurmalasari, N., & Sopiawadi, M. (2023). Intellectual Capital and Firm Performance: The Mediating Role of Governance. Proceeding Of National Conference On Accounting & Finance, 5, 465–474. https://doi.org/10.20885/ncaf.vol5.art1
Ristiani, F., & Wahidahwati. (2021). Pengaruh Intellectual Capital Terhadap Kinerja Keuangan Dengan Competitive Advantage Sebagai Variabel Moderating Wahidahwati Sekolah Tinggi Ilmu Ekonomi Indonesia (Stiesia) Surabaya. Jurnal Ilmu Dan Riset Akuntansi, 10(1), 1–18.
Rivandi, M., & Septiano, R. (2021). Pengaruh Intellectual Capital Disclosure Dan Profitabilitas Terhadap Nilai Perusahaan. Jurnal Akuntansi Trisakti, 8(1), 123–136. https://doi.org/10.25105/jat.v8i1.7631
Soewarno, N., & Ramadhan, A. H. A. (2020). The effect of ownership structure and intellectual capital on firm value with firm performance as an intervening variable. International Journal of Innovation, Creativity and Change, 10(12), 215–236.
Suhadi, I. A. (2024). Impact of intellectual capital on financial performance with company size moderation. International Journal of Financial, Accounting, and Management, 6(1), 47–59. https://doi.org/10.35912/ijfam.v6i1.1833
Tolong, A., As, H., & Rahayu, S. (2020). Analisis Kinerja Keuangan Koperasi Simpan Pinjam Pada Koperasi Suka Damai. Jambura Economic Education Journal, 2(1), 25–33. https://doi.org/10.37479/jeej.v2i1.4455
Попов, К., & Макеева, Е. (2022). Relationship between Board Characteristics, ESG and Corporate Performance: A Systematic Review. Journal of Corporate Finance Research / Корпоративные Финансы | ISSN: 2073-0438, 16(4), 5–20. https://doi.org/10.17323/j.jcfr.2073-0438.16.4.2022.5-20
Copyright (c) 2025 Alifah Arum Trisnawati, Siti Sundari
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgment of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work.
