Authors:
Katherine Helen Aurora, Suci Normala, Riana Sari, Iskandar Muda, Ramadas Kandath, Robert Balku
Addresses:
Department of Accounting, Universitas Sumatera Utara, Medan Campus, Sumatera, Indonesia. Department of FSM Adoption and Services, SAP, Plano, Texas, United States of America. Department of Business Administration, Budapest Metropolitan University, Budapest, Hungary.
Abstract:
This paper examines the strategic link between ISR and financial performance in emerging markets. As stakeholder capitalism gains momentum in international markets, companies in emerging economies are increasingly being lobbied to disclose environmental, social, and governance (ESG) metrics alongside traditional financial performance indicators. Using a robust sample of 448 data points from publicly listed firms across five emerging markets, this paper examines f reporting quality on financial performance indicators, such as credit ratings and market activity ratios, empiricall The work's purpose was to employ the Python language to perform data preprocessing for PV, used to establish a causal relationship with structural equation modelling regarding reporting quality and Return on Equity (ROE), as part of Research and Development. The analysis accounts for firm size, leverage, and industry character to disentangle the specific effect of SRI disclosure. The researchers also found that, despite being a costly option to integrate, even more so when adopting reporting standards, the long-term strategic advantage of having integrated inclusive practices, in terms of better access to capital, brand reputation, and operational risk management, offers tremendous value for money. This study adds to the scarce literature on developing countries by demonstrating that transparency becomes an important strategic resource rather than just a regulatory burden.
Keywords: IntegratedāReporting; Financial Performance; Developing Countries; Strategic Management; Emerging Markets; Corporate Sustainability; Performance Indicators; Risk Management.
Received: 01/01/2025, Revised: 06/03/2025, Accepted: 25/04/2025, Published: 23/12/2025
DOI: 10.64091/ATITP.2025.000183
AVE Trends in Intelligent Technoprise Letters, 2025 Vol. 2 No. 4 , Pages: 202-211