THE IMPACT OF ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) POLICY IN INDONESIA TOWARDS GLOBAL INVESTOR ATTRACTIVENESS: A COMPARATIVE STUDY WITH JAPAN
DOI:
https://doi.org/10.25170/paradigma.v11i2.8322Keywords:
ESG Policy, Foreign Investment, Corporate GovernanceAbstract
This study examines the impact of Environmental, Social, and Governance (ESG) policies on foreign investors' decisions to invest in Indonesia, while also comparing the situation with Japan's ESG policies. ESG serves as a framework for measuring the extent to which a company's business operations align with sustainability principles. A country's ESG policies influence foreign investor interest, as they often serve as key indicators of profitability and corporate governance. Japan strongly supports the implementation of ESG principles in its investment and financial policies through major strategic directives on sustainable finance. Furthermore, Japan's ESG policies aim to engage companies and relevant stakeholders in efforts to enhance the country's appeal to foreign investors. Compared to Japan's policies, this study suggests that Indonesia should adopt more comprehensive ESG policies.
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