Climate change disclosure and firm performance in climate sensitive industries in Indonesia

Drawing on stakeholder theory, this study examines the influence of corporate climate change disclosure (CCD) on the financial performance of firms listed on the Indonesia Stock Exchange (IDX). Focusing on climate-sensitive industry sectors during the 2019–2022 period, the research utilizes a sample of 958 firm-year observations analyzed through multiple linear regression, with results validated via the Heckman two-stage model and robustness tests. The findings reveal a weak positive association between CCD and future firm performance, achieving statistical significance at a conservative threshold. This indicates that while current-year disclosures are associate with subsequent financial outcomes, the magnitude of this effect remains limited. Theoretically, these results extend the boundary conditions of stakeholder theory to emerging markets with voluntary disclosure regimes. Practically, the study suggests that firms can leverage CCD as a strategic signal for long-term resilience and accountability, while providing empirical support for policymakers to strengthen climate disclosure frameworks. Methodologically, this research contributes by applying a TCFD-based framework and rigorous validation techniques, offering a replicable empirical approach for climate-related studies in developing economies.