Title:
The Influence of Eco-efficiency on Financial Performance: Evidence From Indonesian Manufacturing Companies

Authors:
Nadia Fauzi Asila, Falikhatun, Indonesia

Abstract:

With the development of business trends that increasingly prioritize environmental issues, companies need to balance between financial goals and social and environmental goals. Driven by the growing emphasis on environmental factors in business, this study delves into the influence of eco-efficiency and Corporate Social Responsibility (CSR) on corporate financial performance. To explore this, Researcher analyzed data from 132 Indonesian manufacturing companies listed on the Indonesia Stock Exchange between 2019 and 2022. Utilizing EViews 12 software and the Fixed Effect Model, researcher investigated the relationship between these factors and Return on Asset (ROA) as a measure of financial success. The findings reveal a positive correlation between eco-efficiency, CSR practices, and improved financial performance within the manufacturing sector. This finding will also be beneficial, especially for industries or companies in improving their financial performance, given the importance of environmental issues as part of competitive advantage in the business world.

DOI: https://doi.org/10.51505/IJEBMR.2024.8207