ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) PRODUCTIVITY POLICY APPROACH TO MEASURING CORPORATE INTEGRATED REPORTING AND CORE VALUES OF COMPANIES ON THE INDONESIA STOCK EXCHANGE
DOI:
https://doi.org/10.58487/akrabjuara.v11i2.2792Keywords:
Integrated Corporate Reporting; Productivity; Environmental, Social, and Governance; Corporate Core ValuesAbstract
This study aims to analyze the dynamic relationship between the global Environmental, Social, and Governance (ESG) index and the Indonesian stock market , using data from the Indonesia Stock Exchange . ESG is an investment practice that considers environmental, social, and corporate governance impacts in investment decision-making. Thus, ESG is not only a priority for investors but also a crucial factor for companies seeking to attract new investors while maintaining the satisfaction of existing shareholders. In line with this objective, this study evaluates the effect of Corporate Integrated Reporting (CIR) on Core Value Company (CVC) disclosure in companies listed on the Indonesia Stock Exchange. The study sample includes 85 companies with available ESG scores for the period 2020 to 2025, along with annual report data for comparative analysis. Multiple regression methods are applied to assess the effect of ESG productivity policies on CVC within the context of integrated reporting. The results of the study show that CIR has a positive influence on CVC. In addition, ESG productivity policies are significantly associated with increased CIR benefits, although they do not have a direct impact on CVC. The results of this analysis emphasize the importance of implementing CIR and strengthening ESG productivity in enhancing a company's core value, as reflected in improved stock market performance. This research also indicates that advocacy for CIR and ESG disclosure can improve market efficiency, transparency, and corporate accountability
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References
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Zumente, I., & Bistrova, J. ( 2021). The importance of ESG for long-term shareholder value creation : Literature vs. practice. Journal of Open Innovation: Technology, Markets, and Complexity , 7 (2), 127. https://doi.org/10.3390/joitmc7020127
Carmo, C., Correia, I., Leite, J., & Carvalho, A. (2023). Towards voluntary adoption of integrated reporting: Drivers, barriers, and practices. Administrative Sciences , 13 (6), 148. https://doi.org/10.3390/admsci13060148
Cheng, R., Kim, H., & Ryu, D. (2023). ESG performance and firm value in the Chinese market. Investment Analysts Journal , 53( 1), 1–15. https://doi.org/10.1080/10293523.2023.2218 124
Chouaibi, S., Chouaibi, Y., & Zouari, G. ( 2022). Board characteristics and integrated reporting quality: Evidence from European ESG companies . EuroMed Business Journal , 17 (4), 425–447. https://doi.org/10.1108/EMJB-11-2020-0121
Cooray, T., Senaratne, S., Gunarathne, A. D.N., Herath, R., & Samudrage, D. (2020). Does integrated reporting enhance the value relevance of information? Evidence from Sri Lanka. Sustainability , 12 (19), 8183. https://doi.org/10.3390/su12198183
Deng, X., & Cheng, X. (2019). Can ESG indices improve corporate stock market performance? - an empirical study from China. Sustainability, 11(17), 4765. https://doi.org/10.3390/su11174765
Giannopoulos, G., Fagernes, R.V.K., Elmarzouky, M., & Hossain, K.A. (2022). ESG disclosure and financial performance of Norwegian listed companies. Journal of Risk Management and Finance , 15 (6), 237. https://doi.org/10.3390/JRFM1506023
Ibrahim, UE, & Isiaka, A. (2020). The effect of financial leverage on firm value: Evidence from selected companies listed on the Nigerian Stock Exchange. European Journal of Business and Management , 12 (3), 124-135. https://doi.org/10.7176/EJBM/12-3-16
Islam, Md. S. (2021). Investigating the relationship between integrated reporting and corporate performance in a voluntary disclosure regime : Insights from Bangladesh. Asian Journal of Accounting Research , 6 (2), 228-245 . https://doi.org/10.1108/AJAR-06-2020-0039
Jin, X., & Lei, X. (2023). A study on the impact mechanism of ESG on firm value in the concept of sustainable development. Sustainability , 15 (11). https://doi.org/10.3390/su15118442
Juniarti, J., Theja, DD, Tenoyo, N., & Darmasaputra, A. (2023). Does the market respond differently to the timing of corporate action announcements? Convincing Economics & Finance , 11 (1). https://doi.org/10.1080/23322039.2023.2203986
Kerkemeier, M., & Kruse-Becher, R. (2022). Join the club! Dynamics of global ESG index convergence. Finance Research Letters, 49, Article 103085. https://doi.org/10.1016/j.frl.2022.103085
Kim, B., Jung, J., & Cho, S. (2022). Can ESG reduce the diversification discount in cross-border M&A? Borsa Istanbul Review, 22(3), 607–615. https://doi.org/10.1016/j.bir.2021.09.002
La Torre, M., Mango, F., Cafaro, A., & Leo, S. (2020). Do ESG indices affect stock returns? Evidence from the Eurostoxx50. Sustainability, 12(16), 6387. https://doi.org/10.3390/su12166387
Makri, M., & Kabra, KC (2023). International reporting and firm value in developing countries: The moderating role of firm size. Indonesian Journal of Accounting and Sustainability Management , 7 (1), 235-247. https://doi.org/10.28992/ijsam.v7i1.697
Mousa, M., Saleem, A., & Sa´gi, J. (2022). Are ESG stocks a safe haven during COVID-19? Evidence from the Arab region. Sustainability, 14(1), 208. https://doi.org/10.3390/su14010208
Meng, T., Yahya, MHDH, Ashhari, ZM , & Yu, D. (2023). ESG performance, investor attention, and corporate reputation: A threshold model analysis based on panel data of listed companies in China. Heliyon , 9 (10), e20974. https://doi.org/10.1016/j.heliyon.2023.e20974
Responsibility for institutional ownership in leading companies listed on the Indonesia Stock Exchange. INOVASI: Journal of Economics, Finance and Management , 18 ( 3), 540–550. https://doi.org/10.29264/jinv.v18i3.11701
Rochayatun, S., & Kholifah, F. (2021). Corporate social responsibility: Understanding legitimacy, achieving sustainability. International Conference on Engineering, Technology and Social Sciences , 529 , 175–183. https://doi.org/10.2991/assehr.k.210421.02
Ruan, L., & Liu, H. (2021). Environmental, social, governance activities and corporate performance : Evidence from China. Sustainability , 13 (2), 767. https://doi.org/10.3390/su13 020767
Santosa, PW, Setianingrum, A., & Yusuf, C. (2022). Corporate governance and its effect on firm value: Evidence from large companies in Indonesia. Journal of Finance and Banking , 26 (4), 862–873. https://doi.org/10.26905/jkdp.v26i4.7764
Sany, S., Novica, C., & Valentina, C. (2024). Do board size and ESG scores drive firm value? A study of non-financial firms in Thailand. Journal of Accounting and Finance , 26 (1), 67–76. https://doi.org/10.9744/jak.26.1.67-76
Shen, Y. (2023). ESG and firm performance: A literature review. BCP Business & Management , 46 , 283–288. https://doi.org/10.54691/bcpbm.v46i.5107
Sokil, O., Zvezdov, D., Zhuk, V., Kucherkova , S., & Sakhno, L. (2020). Social and environmental costs: The impact of accounting and analytical support on sustainable corporate development in Germany and Ukraine. Journal of Economics XXI, 181 (1–2), 124–136. https://doi.org/10.21003/ea.V181-11
Srivastava, A., & Anand, A. (2023). ESG performance and firm value: The moderating role of ownership concentration. Corporate Ownership and Control , 20 (3), 169– 179. https://doi.org/10.22495/cocv20i3art11
Torelli, R., Balluchi, F., & Lazzini, A. (2020). Greenwashing and environmental communication : Influence on stakeholder perceptions . Business Strategy and the Environment , 29 (2), 407–421. https://doi.org/10.1002/bse.2373
Utomo, SD, & Hapsari, DI (2022). The moderating effect of integrated reporting on firm value (an empirical study of companies in Indonesia). Journal of Positive School Psychology , 6 (11), 123–132.
Velte, P. (2022). Archival research on integrated reporting: A systematic review of the key drivers and impact of integrated reporting on firm value. Journal of Management and Governance , 26 (3), 997–1061. https://doi.org/10.1007/s10997-021-09582-w
Wahl, A., Charifzadeh, M., & Diefenbach, F. (2020). Voluntary adopters of integrated reporting – Evidence on forecast accuracy and firm value. Business Strategy and the Environment , 29 (6), 2542–2556.
https://doi.org/10.1002/bse.2519
Wong, W.C., Batten, J.A. , Ahmad, A.H., Mohamed-Arshad, S.B., Nordin, S., & Adzis, A.A. (2020). Does ESG certification add firm value? Financial Research Letters , 39, 101593. https://doi.org/10.1016/j.frl .
Wu, S., Li, X., Du, X., & Li, Z. (2022). The impact of ESG performance on firm value: The moderating role of ownership structure. Sustainability , 14 (21), 14507. https://doi.org/10.3390/su142114507
Zumente, I., & Bistrova, J. ( 2021). The importance of ESG for long-term shareholder value creation : Literature vs. practice. Journal of Open Innovation: Technology, Markets, and Complexity , 7 (2), 127. https://doi.org/10.3390/joitmc7020127
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Published
2026-05-05
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Susan Rachmawati, Andi Martias, Sudirja, & Firstianty Wahyuhening F. (2026). ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) PRODUCTIVITY POLICY APPROACH TO MEASURING CORPORATE INTEGRATED REPORTING AND CORE VALUES OF COMPANIES ON THE INDONESIA STOCK EXCHANGE. Akrab Juara : Jurnal Ilmu-Ilmu Sosial, 11(2), 121–142. https://doi.org/10.58487/akrabjuara.v11i2.2792
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