UBUB

APMBA (Asia Pacific Management and Business Application)APMBA (Asia Pacific Management and Business Application)

The development of recent issues regarding the climate change crisis, the impact of environmental damage, social welfare and good governance has forced several companies to adopt new assessment metrics. Therefore, this study aims to analyze and examine the effect of ESG valuation on firm value, which is mediated by profitability. This quantitative research used secondary data, and the test used path analysis. The studys results prove that profitability (ROA) can mediate the relationship between ESG assessment and firm value (Tobins Q). This study concludes that investors still see the value of profitability in considering the companys value in the future due to making investment decisions. This leads to capitalism, which means that investors still have difficulty exploiting the ESG aspect, so they must be assisted by looking at financial performance improvement in selecting companies for making investment decisions in the capital market.

The study demonstrates that profitability significantly mediates the relationship between ESG assessment and firm value.Investors continue to prioritize profitability when evaluating companies, indicating a difficulty in fully utilizing ESG aspects in investment decisions.Consequently, financial performance remains a crucial factor for investors when selecting companies in the capital market.

Penelitian lanjutan dapat dilakukan untuk mengeksplorasi lebih dalam mengapa investor masih sangat bergantung pada indikator keuangan tradisional seperti ROA dalam pengambilan keputusan investasi, meskipun ada peningkatan kesadaran akan pentingnya ESG. Studi kualitatif, seperti wawancara dengan investor dan manajer investasi, dapat memberikan wawasan tentang persepsi dan preferensi mereka terkait ESG. Selain itu, penelitian dapat difokuskan pada pengembangan model penilaian ESG yang lebih komprehensif dan terintegrasi dengan metrik keuangan, sehingga dapat memberikan gambaran yang lebih akurat tentang nilai perusahaan jangka panjang. Terakhir, penelitian dapat menyelidiki peran regulasi dan kebijakan pemerintah dalam mendorong adopsi ESG oleh perusahaan dan meningkatkan kepercayaan investor terhadap laporan ESG.

  1. The Effect of Environmental, Social and Governance (ESG) Assessment on Firm Value with Profitability... doi.org/10.21776/ub.apmba.2023.012.01.4The Effect of Environmental Social and Governance ESG Assessment on Firm Value with Profitability doi 10 21776 ub apmba 2023 012 01 4
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