The Effect of Carbon Performance on Corporate Financial Performance in a Growing Economy: Evidence from Indonesia

This study aims to examiAne the effect of carbon performance on corporate financial performance, with firm growth (as a proxy for a growing economy) as a moderating variable. The method employed is a quantitative approach using secondary data. The sample consists of 4,265 firm-year observations from manufacturing companies listed on the Indonesia Stock Exchange over the 2019–2023 period. The results show that Carbon Emission Intensity (CEI) has a significant impact on two out of three financial performance indicators tested, namely Return on Assets (ROA) and Return on Investment (ROI), indicating that better carbon performance can positively contribute to financial outcomes. However, firm growth does not moderate the relationship between CEI and financial performance, suggesting that growth factors do not influence the positive impact of CEI on corporate financial performance in the Indonesian manufacturing context