Evaluating the Impact of ESG Practices on Company Values in ASEAN-5 Region: The Moderating Roles of Financial Flexibility and Capital Structure

This research examined the influence of environmental, social, and governance (ESG), financial flexibility, and capital structure on company value. Company value was measured using Tobin's Q, ESG was evaluated through the ESG score from Thomson Reuters, financial flexibility was assessed through a financial flexibility proxy, and capital structure was measured using the debt-to-equity Ratio (DER). The research also employed control variables, including return on assets, firm size, firm age, growth, inflation, gross domestic product, and COVID-19. The purposive sampling method was employed to analyze secondary data from 101 companies in the ASEAN-5 region (Indonesia, Malaysia, the Philippines, Singapore, and Thailand) from 2016 to 2022. The results indicate that ESG positively impacts a company's value. Financial flexibility and capital structure have a negative effect on company value. The control variables that significantly impact ROA, size, growth, GDP, and COVID-19, while age and inflation do not have a significant effect. The relevance of this research in finance lies in strengthening the relationship between non-financial factors (ESG) and a company's financial performance, as well as in understanding how managing financial flexibility and capital structure can support companies' sustainability and long-term value.