Ownership structure, esg disclosure, firm value, and performance: the moderating role of the audit committee

Abstract

This research examines how different ownership structures—foreign, public, state, and family—impact ESG disclosure, firm value, and firm performance in Indonesia, with audit committee strength as a potential moderator. Using panel data from 140 firms listed on the Indonesia Stock Exchange between 2018 and 2020 and drawing on legitimacy, stakeholder, and agency theories, we applied PLS-SEM for analysis. Our findings reveal that foreign and widely held public ownership are positively associated with more extensive ESG reporting, whereas state and family stakes show no significant effect. Enhanced ESG disclosure also correlates with higher firm value, but it does not translate into measurable improvements in operational performance. Furthermore, robust audit committees strengthen the link between ESG transparency and market valuation, but they do not enhance the relationship between ESG reporting and actual performance outcomes. These results suggest that, despite its voluntary status, ESG disclosure drives investor perceptions of value but has yet to deliver operational gains. We recommend that Indonesian regulators consider mandating ESG requirements for listed firms to align reporting practices with both market expectations and real-world performance improvements.