Dewi Cahyani Pangestuti

Enterprise risk management (ERM) is a crucial aspect of corporate operations. This study examines the impact of environmental uncertainty, industry competition, and firm complexity on Enterprise Risk Management implementation and firm performance in the Southeast Asian mining industry. Utilizing data from 205 mining companies listed on Southeast Asian stock exchanges from 2016 to 2022, the analysis employs panel data regression methods. The findings reveal that environmental uncertainty does not significantly affect ERM, while industry competition positively influences ERM but negatively impacts firm performance. Firm complexity positively affects both ERM and performance. ERM mediates the relationships between industry competition, firm complexity, and performance, while intellectual capital moderates the effect of ERM on performance. These results underscore the strategic importance of integrating ERM practices and developing intellectual capital to enhance firm performance amidst competitive and complex business environments. The study contributes to the literature by providing empirical evidence on the nuanced relationships between these variables in the context of the Southeast Asian mining sector and offers practical insights for policymakers and industry leaders.

Type of the article: Research Article

Abstract
This study explores the impact of environmental uncertainty and industry competition on environmental, social, and governance (ESG) practices and company value in the energy sector across six ASEAN countries (Indonesia, Malaysia, Singapore, Thailand, the Philippines, and Vietnam) during 2013–2024. Using an unbalanced panel dataset comprising 257 companies and 2,570 observations, the analysis employs a two-way fixed effects (FE) model and bootstrap mediation tests. The results reveal four critical findings. First, environmental uncertainty (β = 0.032, p < 0.001) and industry competition (β = 0.021, p = 0.010) exert a significant positive influence on ESG practices, suggesting that firms enhance sustainability disclosures as a strategic mechanism to maintain institutional legitimacy and manage exogenous risks. Second, both environmental uncertainty (β = –0.047, p < 0.001) and industry competition (β = –0.056, p = 0.006) significantly reduce firm value (Tobin’s Q) due to heightened market volatility, margin compression, and increased risk premiums. Third, ESG practices do not exhibit a significant direct effect on company value (β = 0.011, p = 0.560), indicating that direct financial premiums from sustainability efforts remain limited in the short term. Finally, bootstrap mediation tests confirm that ESG does not significantly mediate the influence of either environmental uncertainty or industry competition on firm value. This study highlights ESG as a risk mitigation tool rather than a direct driver of corporate valuation within the ASEAN energy landscape. It advises energy practitioners to integrate ESG policies with operational resilience while accounting for systemic external pressures in their core corporate strategy.

Acknowledgment
We gratefully acknowledge the financial support provided by the Ministry of Higher Education, Science, and Technology of the Republic of Indonesia.