PENGARUH ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) PERFORMANCE TERHADAP NILAI PERUSAHAAN DENGAN PROFITABILITAS SEBAGAI VARIABEL MEDIASI (Studi Pada Perusahaan yang Terdaftar di IDX ESG Leaders Tahun 2021-2024)

This quantitative study aims to analyze the effect of Environmental, Social, and Governance (ESG) Performance on firm values, with profitability (Return On Assets [ROA] and Return On Equity [ROE]) as mediating variables. Using a purposive sampling method, a sample of 18 companies consistently listed on the Indonesia stock Exchange (IDX) ESG Leaders index for the 2021-2024 period was selected and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results indicate that Environmental and social Performance do not significantly affect firm value. Conversely, Governance Performance and Profitability (ROA and ROE) exhibit a significant positive effect on form value. Regarding profitability, Environmental Performance has a significant positive effect, whereas Governance Performance has a significant negative effect due to short-term governance compliance cost. Meanwhile, Social Performance shows no significant effect on profitability. Furthermore, profitability (ROA and ROE) successfully mediates the effects of both Environmental and Governance Performance on firm value, but fails to mediate the effect of Social Performance. These findings confirm that while implementing corporate governance mat strain short-term profitability, it plays a robust role in enhancing firm value in the eyes of investors.