CORPORATE ENVIRONMENTAL RESPONSIBILITY, GREEN INNOVATION, AND FINANCIAL PERFORMANCE: EVIDENCE FROM INDONESIAN ENERGY SECTOR FIRMS

Abstract

Abstract

Environmental issues such as excessive energy production and consumption can impact environmental sustainability. Public companies are responsible for reporting their economic, social, and environmental performance to the public. Environmental responsibility is linked to pollution management and clean production. Green innovation relates to the development of processes, product, and technologies to reduce negative impacts on the environment. This study examines the effect of corporate environmental responsibility and green innovation on corporate financial performance.

This is a quantitative explanatory study of 43 companies listed in the energy sector of the Indonesia Stock Exchange from 2021 to 2025. The analysis used random-effect panel regression with STATA. The result of this study indicates that corporate environmental responsibility significant positive, but green innovation insignificant on financial performance. These findings provide new insight for optimizing environmental responsibility and green innovation to support corporate sustainability programs.