FROM GREEN STRATEGY TO PERFORMANCE: THE MODERATING ROLE OF SUSTAINABILITY REPORTING QUALITY

This study investigates the effects of green competitive advantage (GCA) and green innovation (GI) on company performance, with sustainability report quality (SRQ) serving as a moderating variable. Firm size and firm age are included as control variables to enhance empirical robustness. Using a quantitative approach, the study analyzes panel data from 248 manufacturing firms listed on the Indonesia Stock Exchange (IDX) during 2022–2023, yielding 496 firm-year observations. The hypotheses are tested using panel data regression and Moderated Regression Analysis (MRA). The findings reveal that GCA has a significant positive effect on company performance, whereas GI does not demonstrate a statistically significant direct impact. Furthermore, SRQ significantly strengthens the relationship between GCA and company performance but does not moderate the relationship between GI and performance. The primary contribution of this study lies in the refinement and extension of the SRQ construct by incorporating two additional dimensions—responsiveness and impact—which extend beyond conventional disclosure attributes such as accuracy and reliability. This enhanced SRQ framework allows for a more policy-relevant evaluation of whether sustainability reports not only comply with reporting standards but also meaningfully address stakeholder concerns and demonstrate tangible performance outcomes. From a policy perspective, the results suggest that sustainability reporting frameworks should emphasize report substance, stakeholder responsiveness, and measurable impact rather than focusing solely on disclosure volume or formal compliance. Strengthening SRQ can enhance the credibility of green strategies and increase their contribution to firm performance. Overall, the findings provide important implications for regulators, standard setters, and policymakers seeking to improve the effectiveness of sustainability disclosure regimes and promote performance-oriented sustainability practices in emerging markets.