Does competitive advantage strengthen the value relevance of ESG disclosure?

The increasing turmoil in the external organizational setting or business environment has focused attention on capabilities and resources as the primary source of competitive advantage. Obviously, this statement points to the application of the resource-based view (RBV) of organizational management. Nevertheless, what constitutes RBV remains an illusion in many quarters of organizational management, as scholars have managed to put up their personal ideas, and managed to converge on phenomenon-driven theories, in addition to RBV. This paper reviews the concepts of RBV in light of knowledge management to highlight some critical pitfalls that might have eluded the research community on the subject matter of RBV. To this end, this paper’s educational value lies in the fact that it simplifies the concept of RBV to the new researcher in a fashion that is capable of appealing to his or her level. A cross-sectional qualitative research approach was employed in an effort aimed at understanding the role of RBV in creating a sustainable competitive advantage and key competencies. A total of 20 relevant articles were searched from different databases and search engines, including Scopus, EBSCO, ABI Inform, IEEE, PubMed, Science Direct, SABINET, IEEE, Bing, Science Direct, and Google Scholar. The findings indicate that RBV plays an important role and assists organizations not only create, nurture, and maintain competitive advantage, but also understand the collective resources needed to compete favorably in a globalized and highly competitive market. With expert knowledge workers at its core to provide support for knowledge creation, sharing, and utilization, the RBV principles discussed in this paper promise to guarantee a methodological step geared towards the achievement of competitive advantage. It, therefore, makes an incremental contribution to the RBV to attain modest improvement in organizational settings.

Environmental, social, and governance (ESG) performance is critical in mitigating climate change. Energy companies must include ESG practices in their business plans because they can determine firm value. This study investigates the impact of ESG and firm size on firm value in Indonesian energy sector, which is moderated by profitability through return on assets. This study uses a sample of 19 energy companies listed on the Indonesia Stock Exchange from 2016 to 2022. A panel data regression model is applied to estimate the impact of ESG practices and firm size on firm value with the moderating role of return on assets. The study results found that ecological, social, and governance disclosure in the model with return on assets as a moderator independently positively impacts firm value but not vice versa. The interaction between return on assets and ESG practices has no impact on firm value, which means that the role of return on assets as a moderator cannot strengthen the influence of ESG and firm size on firm value. Return on assets positively impacts firm value if it acts as an independent variable without a moderator. Firm size independently has a negative impact on firm value but has no effect if it interacts with return on assets. The implications of the empirical findings provide recommendations for policymakers, corporate management, investors, and academics. Environmental, social, and governance disclosure practices are essential to pay attention to as they can improve sustainability performance and firm value in the energy sector of Indonesia.

Acknowledgment
Acknowledgments are expressed to the Directorate General of Higher Education, Research, and Technology, Ministry of Education, Culture, Research and Technology for the Funding Assistance for the Master’s Thesis Research Grant Scheme [Contract Number: 01-1-4/675/SPK/VII/2024].

Several studies have examined the relationship between inventory management and firm performance. However, most of these studies ignore the impact of inventory types on the relationship. Moreover, the relationship is influenced by some factors such as cost of capital which has not been considered. This study examines the moderating effect of cost of capital on the relationship between inventory types and firm performance. The data of 48 firms for the period 2010-2016 which formed 279 firm-year observations were used in this study. With the use of Pearson correlation and panel Generalized Method of Moments (GMM) estimation, the findings show that inventory management with consideration of its types influence firm performance in the long term. In addition, it is also found that cost of capital moderates the relationship between inventory management and firm performance. However, the interaction between cost of capital and inventory types has different implications. It is suggested that firms should consider cost of capital when making decision on inventory types and align their inventory control to fit in to the changes in their business environment.