CSER ON SUSTAINABILITY OF FINANCIAL PERFORMANCE: PERSPECTIVE ON INNOVATION AND FINANCIAL CONSTRAINTS

Abstract

Regulations around the world place a lot of emphasis on responsible investment policies and regulations, but not all companies accurately estimate environmental costs and benefits. The purpose of this study is to analyze the strategy of achieving financial performance that is taken into account from the corporate social and environmental responsibility (CSER) factor, which involves innovation and financial constraints of the company. This study uses a sample of companies in the basic and chemical sectors listed on the Indonesia Stock Exchange from 2019 to 2023. Although the results of the track analysis test show that CSER has no effect on sustainable financial performance, the findings prove the role of innovation that connects CSER to sustainable financial performance. The interaction of CSER and financial constraints weakens the relationship between CSER in improving sustainable financial performance. So that this study can be a strategy for industrial companies to carry out regulations that are environmentally and socially responsible through the development of innovations in accordance with technological developments and controlling the financial constraints faced.