The Impact of ESG Risk Score and Disclosure on Financial Performance: Moderating Role of Gender Diversity

Dinda Reskiana Putri (), Gagaring Pagalung and Syarifuddin Rasyid
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Dinda Reskiana Putri: Hasanuddin University, Faculty of Economic and Business
Gagaring Pagalung: Hasanuddin University, Faculty of Economic and Business
Syarifuddin Rasyid: Hasanuddin University, Faculty of Economic and Business

A chapter in Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024), 2025, pp 375-393 from Springer

Abstract: Abstract Global efforts to achieve the Sustainable Development Goals (SDGs) have resulted in a shift in business trends that focus on sustainability issues. Environmental, Social, and Governance (ESG) is one of the principles or business practices that can support the sustainability of a company. This study aims to test and analyze the effect of ESG risk score and disclosure on financial performance with gender diversity as a moderating variable. Data is obtained from the financial statements and sustainability reports of 18 companies that are consistently listed in the ESG Leaders index on the Indonesia Stock Exchange for the period 2020-2023. Data were analyzed using multiple linear regression analysis and moderated regression analysis. The findings show that ESG risk score has a negative effect on financial performance (ROA), while ESG disclosure is found to have a positive effect. Additionally, gender diversity is able to moderate the relationship between these variables. The findings of this study imply that companies need to consider ESG risk scores and disclosures on financial performance, especially with gender diversity as a moderator. For investors, these findings can be a reference in investing in companies that care about the social environment and its governance.

Keywords: Environmental; Social; Governance; Risk Score; Disclosure; Financial Performance; Gender Diversity (search for similar items in EconPapers)
Date: 2025
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DOI: 10.2991/978-94-6463-758-8_33

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