THE IMPACT OF ESG PERFORMANCE INDICATORS ON THE MARKET CAPITALIZATION OF LISTED COMPANIES IN THE STOCK EXCHANGE OF THAILAND

Abstract

This study aims to examine the impact of ESG (Environmental, Social, and Governance) indicators on the market capitalization of listed companies on the Stock Exchange of Thailand, specifically those in the sustainable stock list (THSI) from 2018 to 2022, totaling 15 companies. The study uses ESG indicators as independent variables, which include environmental, social, and governance factors. The control variables are the policy interest rate, unemployment rate, and growth rate. Additionally, dummy variables such as the COVID-19 situation are included. The dependent variable is the market capitalization. Data will be analyzed both descriptively and quantitatively, using the Panel Model estimation method, with either the Fixed Effects Model or Random Effects Model chosen based on the Hausman test. The study's results, using the Fixed Effects Model estimation method, reveal that ESG indicators such as the amount of waste and the amount of water usage have a statistically significant impact on market capitalization. An increase in the amount of waste leads to a decrease in market capitalization, while an increase in water usage leads to an increase in market capitalization. Furthermore, the COVID-19 situation also significantly affects market capitalization.