The Effect of ESG Disclosure, Efficiency, and Liquidity on Banking Performance Listed on the Indonesia Stock Exchange for the 2021-2025 Period

Abstract

This study aimed to examine the effects of ESG Disclosure, Efficiency (BOPO), and Liquidity (LDR) on Banking Performance (ROA) of banking companies listed on the Indonesia Stock Exchange during the 2021-2025 period. A quantitative approach with a purposive sampling technique was employed, yielding a sample of 18 banking companies with a total of 90 panel data observations. Data were analyzed using panel data regression with a Robust Random Effect Model (REM) in STATA 17. Partial test results showed that ESG Disclosure had no significant effect on Banking Performance (H1 rejected), Efficiency had a significant negative effect on Banking Performance (H2 accepted), while Liquidity had no significant effect on Banking Performance (H3 rejected). Simultaneously, the three independent variables significantly affected Banking Performance (H4 accepted), with an Overall R-squared value of 88.95%, indicating strong explanatory power. These findings suggest that operational efficiency was the primary determinant of bank profitability compared to ESG disclosure and liquidity, implying that bank management should prioritize operational cost control to sustain profitabilityliquidity, implying that bank management should prioritize operational cost control to sustain profitability.