Assessing the Impact of Environmental, Social and Governance (ESG) Disclosures on Financial Performance in Taiwan^s Semiconductor Sector (2020-2022) Berty Adi Susanti
Accounting, Bandung State Polytechnic
Jalan Gegerkalong Hilir, Ciwaruga, Kec. Parongpong, Kabupaten Bandung Barat, Jawa Barat 40559
Abstract
This study aims to examine the effect of ESG disclosure on corporate financial performance in semiconductor sector companies in Taiwan listed on the TWSE in 2020-2022. Financial performance is measured using return on investment (ROI). The research sample is semiconductor sector companies listed on the TWSE for 2020 - 2022 (3 years) using a purposive sampling technique. ESG disclosure, which refers to the information a company discloses regarding the impact of its operations on environmental, social, and corporate governance practices, is considered one of the factors that could potentially affect financial performance. In other words, this study aims to test whether the higher the level of ESG disclosure of a company, the higher the level of return on investment obtained. This study used quantitative methods with hypothesis testing, a panel data linear regression analysis technique. The results of this study indicate that environmental disclosure does not effect on the company^s financial performance. This is due to several factors, such as the complexity of environmental issues such as environmental damage that occurs due to irresponsible corporate activities, or investors who have not considered environmental practices and disclosures as one of the factors that determine investment decisions in a company. Meanwhile, social disclosure and governance have a positive effect on the company^s financial performance. Simultaneously ESG affects the company^s financial performance. This shows that investors respond positively to the company^s efforts to increase transparency social accountability and good corporate governance. The implication of this study is the importance for companies to focus on disclosing quality ESG information, as this can increase investor confidence and ultimately have a positive impact on the company^s financial performance. Thus, the results of this study can be considered by companies in formulating policies that encourage companies to improv
