CORPORATE PERSPECTIVES ON GREEN FINANCE AND ITS INFLUENCE ON FIRM VALUE AND INVESTMENT STRATEGIES IN INDONESIA
DOI:
https://doi.org/10.21512/jafa.v12i2.13934Keywords:
Green finance, ESG, firm value, investment strategy, Indonesia, qualitative document analysisAbstract
This study examines the corporate perspectives on green finance instruments and their impact on firm value and investment strategies among publicly listed companies in Indonesia. While global research on the sustainable finance is extensive, evidence from the emerging economies, particularly using the qualitative approaches, remains limited. Guided by the Resource-Based View (RBV), Signalling Theory, and Stakeholder Theory, the study investigates how corporations frame, justify, and communicate their engagement with green bonds, sukuk, and ESG-linked initiatives. Using a qualitative document analysis approach, data from corporate sustainability reports, annual filings, and regulatory disclosures from 50 companies across multiple sectors between 2021 and 2023 were analysed. The thematic content analysis was applied to identify the patterns in the disclosure narratives and the strategic framing. The findings reveal that green finance instruments serve not only as capital-raising tools but also as strategic resources that improve competitiveness, as market signals that reduce information asymmetry, and as legitimacy mechanisms that reinforce stakeholder trust. The study contributes theoretically by integrating multiple theoretical lenses on green finance adoption and practically by providing suggested ways for regulators, corporate leaders, and investors to enhance disclosure credibility and align ESG strategies with long-term value creation. These insights suggest that robust green finance engagement can become a strategic driver of corporate resilience and stakeholder trust in emerging markets.References
Amalia, M. R., Lesmana, T., & Arini, R. E. (2024). Impact Analysis of Sustainable Financial Reporting and Environmental Regulatory Compliance on Decision Making Effectiveness in Bandung Manufacturing Industry. In West Science Interdisciplinary Studies (Vol. 02, Issue 05).
Barney, J. B. (1991). Firm Resources and Sustained Competitive Advantage. Journal of Management, 17, 99–120.
BCA. (2023). Live to Empower.
BNI. (2023). Green Bond Report.
BNI. (2025). GREEN BOND REPORT.
Bowen, G. A. (2009). Document Analysis as a Qualitative Research Method. Qualitative Research Journal, 9(2), 27–40.
Braun, V., & Clarke, V. (2021). Thematic Analysis: A Practical Guide. Sage.
BRI. (2023). Empowering The People Great Resilience, Strong Sustainability.
Chiţimiea, A., Minciu, M., Manta, A. M., Ciocoiu, C. N., & Veith, C. (2021). The drivers of green investment: A bibliometric and systematic review. Sustainability (Switzerland), 13(6). https://doi.org/10.3390/su13063507
Climateworks Centre. (2025). Decarbonising Indonesia’s Manufacturing Sector: Opportunities and Pathways for Transition. Https://Www.Climateworkscentre.Org.
Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2011). Signaling theory: A review and assessment. Journal of Management, 37(1), 39–67.
Creswell, J. W., & Poth, C. N. (2018). Qualitative Inquiry and Research Design: Choosing Among Five Approaches (4th ed.). SAGE Publications.
Darsa, M., & Shawndefar, M. (2023). Strengthening ESG policies amid calls for a standardized global framework. Https://Www.Pwc.Com/Id/En/Pwc-Publications/Services-Publications/Legal-Publications/Strengthening-Esg-Policies-amid-Calls-for-a-Standardised-Global-Framework.Html.
Flammer, C. (2021). Corporate green bonds. Journal of Financial Economics, 142(2), 499–516. https://doi.org/10.1016/J.JFINECO.2021.01.010
Freeman, R. E. (1984). Strategic Management: A Stakeholder Approach. MA: Pitman.
Gunawan, N., Tukiainen, K., & Boulle, B. (2022). Green Infrastructure Investment Opportunities. www.climatebonds.net
Haas, R., Sayer, M., Ajanovic, A., & Auer, H. (2023). Technological learning: Lessons learned on energy technologies. In Wiley Interdisciplinary Reviews: Energy and Environment (Vol. 12, Issue 2). John Wiley and Sons Ltd. https://doi.org/10.1002/wene.463
Habib, A., Oláh, J., Khan, M. H., & Luboš, S. (2025). Does integration of ESG disclosure and green financing improve firm performance: Practical applications of stakeholders theory. Heliyon, 11(4). https://doi.org/10.1016/j.heliyon.2025.e41996
Hart, S. L. (1995). A Natural-Resource-Based View of the Firm. Academy of Management Review, 20, 986–1014.
IFC. (2022). Indonesia Country Progress Report. www.sbfnetwork.org.
Köcher, S., Doerbandt, D., Heising, W., Russell, R., Hardin, L., & Theissen, S. (2024, October 7). Reducing Costs and Carbon in Manufacturing Networks. BCG.
Kovalchuk, A. (2025). Bridging finance and sustainability: A systematic review of responsible investment (RI) performance in BRICS markets. Sustainable Futures, 10. https://doi.org/10.1016/j.sftr.2025.101024
Kurniawan, P. S., & Basuki, B. (2024). Sustainability reporting assurance practice in Indonesia: assuror and academician perspective. Accounting Research Journal, 37(5), 481–499. https://doi.org/10.1108/ARJ-05-2023-0132
Kusmayadi, A., & Koestoer, R. H. (2022). Ensuring Environmental Sustainability of Infrastructure Projects: A Perspective Review in A Case of Indonesia. IOP Conference Series: Earth and Environmental Science, 1111(1). https://doi.org/10.1088/1755-1315/1111/1/012014
Lazarus, K. M., Savas, L., & Pratiwi, R. (2021). Raising the Bar on Environmental, Social, and Corporate Governance Standards.
Manta, O. (2024). The role of financial instruments in promoting sustainable finance and the circular economy. Economic Growth in the Face of Global Challenges. Consolidation of National Economies and Reduction of Social Inequalities: Conference Proceedings. Vol II, 263–282. https://doi.org/10.36004/nier.cecg.III.2024.18.28
Martin, V. (2023). Green Finance: Regulation and Instruments1. Journal of Central Banking Theory and Practice, 12(2), 185–209. https://doi.org/10.2478/jcbtp-2023-0019
Ningsih, W., Izzulhaq, W., & Setiawan, D. (2024). Exploring Green Finance Studies in Indonesia: A Systematic Literature Review (SLR) for Sustainable Development. PROCEEDING ACoMC. https://www.researchgate.net/publication/388063405
OJK. (2021). Sustainable Finance Roadmap Phase II (2021 - 2025).
Ozili, Peterson. K. (2021). Making Sustainble Finance Sustainable. Financial Internet Quarterly, 17(3), 64–70. https://doi.org/10.2478/fiqf-2021-0020
Parmar, B. L., Freeman, R. E., Harrison, J. S., Wicks, A. C., Purnell, L., & de Colle, S. (2010). Stakeholder theory: The state of the art. . Academy of Management Annals, 4(1), 403–445.
REGULATION OF FINANCIAL SERVICES AUTHORITY, Pub. L. No. 169, BOARD OF COMMISSIONER OF THE FINANCIAL SERVICES AUTHORITY (2017).
Rohman, I. K., Setiawan, F. J. D., & Ginting, E. G. P. (2024). Snapshot of ESG Investing in Indonesia’s Stock and Bond Market. https://www.ojk.go.id/id/berita-dan-kegiatan/publikasi/Documents/Pages/Roadmap-Keuangan-
Smith, J., & Sudjonno, Y. (2023). ESG in Indonesia: Access to Finance 2023.
Spence, M. (1973). Job Market Signaling. Quarterly Journal of Economics, 87, 355–374.
Syarkani, Y., Subu, M. A., & Waluyo, I. (2024). Impact of ESG Performance on Firm Value: A Comparison of Emerging and Developed Markets. Journal of Business and Management, 2(4), 204–219. https://doi.org/10.61978/commercium
Tang, D. Y., & Zhang, Y. (2020). Do shareholders benefit from green bonds? Journal of Corporate Finance, 61, 101427. https://doi.org/10.1016/J.JCORPFIN.2018.12.001
Tania, J., Wahyuningtyas, A., Putri, P., & Muharam, H. (2025). Integrating ESG Metrics into Corporate Strategy: Analysing the Long-term Value and Profitability. Research Horizon, 05(01), 21–32.
UNDP. (2021). INDONESIA’S GREEN BOND & GREEN SUKUK INITIATIVE. www.djppr.kemenkeu.go.id
Valentinov, V., de Oliveira Santos Jhunior, R., & de Araujo Góes, H. A. (2025). Corporate Environmental Sustainability Via Stakeholder Collaboration: Insights from Classical Institutional Economics. Journal of Business Ethics. https://doi.org/10.1007/s10551-025-06023-8
Widarwati, E., Rohmah, N. N., Wityasminingsih, E., Nurmalasari, N., Apriandi, D. W., & Sopiawadi, M. (2024). Green investment and firm value: Does corporate governance matter? Journal of Accounting and Investment, 25(3), 1156–1174. https://doi.org/10.18196/jai.v25i3.22159
Widjaja, S., & Rekan. (2024). The Development of ESG reporting and assurance readiness: Bridging global and local perspectives. KPMG.
Xaviera, A., Febrianto, R., Widiastuty, E., & Iswardi, I. (2024). ESG, Firm Value, and Life Cycle: Evidences from South East Asia. Jurnal Dinamika Akuntansi Dan Bisnis, 11(2), 331–334. https://doi.org/10.24815/jdab.v11i2.40449
Xiao, R., Deng, J., Zhou, Y., & Chen, M. (2023). Analyzing Contemporary Trends in Sustainable Finance and ESG Investment. Law and Economy, 2(11), 44–52. https://doi.org/10.56397/le.2023.11.06
Downloads
Published
Issue
Section
License
Authors who publish with this journal agree to the following terms:
Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).
