The Impact of ESG Disclosure on Financial Performance in Manufacturing Industry in Indonesia

Environmental, Social, and Governance (ESG) disclosure serves as a reflection of a firm’s devotion to sustainable practices. The ESG disclosure is also frequently linked to stronger financial results. While earlier research has indicated dissemination of ESG as related information is hypothesized to shape the financial trajectory of a corporation, the impact often varies depending on the industry. This research concentrates on the manufacturing sector, given its status as the largest contributor to carbon emissions and its significant role in Indonesia's economy in 2024. The study investigates how ESG disclosure and financial performance is explored, with particular attention given to the moderating influence of firm size. The study uses a quantitative panel data approach with secondary data collected from Bloomberg and company annual reports. The result reveals that, within this sector, ESG disclosure does not exert a statistically meaningful impact on financial performance, and company size does not alter this relationship. The result means that investors in Indonesia have not considered the ESG disclosure as an important factor when making investment decisions.