THE EFFECT OF ESG DISCLOSURE AND CARBON EMISSION DISCLOSURE ON COMPANY INVESTMENT DECISIONS: A STUDY OF THE ENERGY AND MINING SECTORS IN INDONESIA

Abstract

This study aims to analyze the influence of ESG disclosure and carbon emission disclosure on investment decisions of companies in the energy and mining sectors in Indonesia. With increasing attention to sustainability issues, environmental disclosure has become a crucial factor considered by investors in making investment decisions. Previous research has shown that ESG and carbon emission disclosure can improve investment efficiency by reducing information asymmetry. However, recent research indicates a potential mismatch between disclosure and actual environmental performance, raising doubts about the credibility of the information provided. This study uses panel data from energy and mining sector companies listed in the LQ45 index for the 2021–2024 period. The analytical method used is multiple linear regression to examine the relationship between ESG disclosure, carbon emission disclosure, and corporate investment decisions. The results are expected to indicate whether these disclosures serve as informative signals for investors or are merely symbolic and do not reflect actual company performance. This study contributes by integrating the perspectives of signaling theory and the phenomenon of mismatch between disclosure and actual performance. Furthermore, this study also provides practical implications for investors, regulators, and corporate management in evaluating the quality of sustainability disclosure in emerging markets.