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VOL. 6, ISSUE 3 (2024)
The impact of ESG disclosure on firm performance: Unveiling the moderating role of financial slack
Authors
Glen Surya Pasaribu, Nur Cahyonowati
Abstract
This study aims to investigate the effect of Environmental, Social, and
Governance (ESG) disclosure on firm performance. Given the inconsistent
findings in previous research regarding the relationship between ESG disclosure
and firm performance, this study seeks to further examine these inconsistencies
by incorporating financial slack as a moderating variable. Data for this study
were obtained from Bloomberg database, covering non-financial companies listed
on the Indonesia Stock Exchange between 2019-2022. Sampling was conducted using
purposive sampling method, resulting in a total of 258 observations. This study
employs the use of Moderated Regression Analysis (MRA) using SPSS 26 software
for carrying out the empirical analysis. The results demonstrate that ESG
disclosures have a significant positive effect on firm performance. Financial
slack has an insignificant positive impact on firm performance. Meanwhile,
financial slack as a moderating variable is able to weaken the positive effect
of ESG disclosures on firm performance.
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Pages:16-23
How to cite this article:
Glen Surya Pasaribu, Nur Cahyonowati "The impact of ESG disclosure on firm performance: Unveiling the moderating role of financial slack". International Journal of Commerce and Economics, Vol 6, Issue 3, 2024, Pages 16-23
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