THE IMPACT OF CSR IMPLEMENTATION ON STOCK PRICES IN INDONESIA & MALAYSIA

Abstrak

Corporate Social Responsibility (CSR) has become an integral component of corporate strategy, influencing not only societal and environmental well-being but also the financial performance and stock prices of companies. This study examines the impact of CSR implementation on stock prices in Indonesia and Malaysia, highlighting how different regulatory frameworks, cultural contexts, and economic conditions shape this relationship. In Indonesia, mandatory CSR activities for companies involved in natural resources, coupled with a focus on local community development and environmental sustainability, have enhanced corporate reputation, operational efficiency, and investor confidence. Companies such as PT Unilever Indonesia Tbk and PT Astra International Tbk exemplify these benefits. In Malaysia, stringent CSR reporting guidelines by Bursa Malaysia have encouraged transparency and accountability, attracting both local and international investors. Companies like Nestlé Malaysia Berhad and Sime Darby Berhad have leveraged these guidelines to align with global sustainability standards, supporting stock price stability and growth. Comparative analysis reveals that while Indonesian companies primarily gain domestic investor confidence through local CSR efforts, Malaysian companies attract a broader investor base through stringent reporting and international alignment. This study underscores the strategic importance of CSR in achieving sustainable growth and investor confidence, demonstrating that CSR is not just a moral obligation but a strategic tool for enhancing competitive advantage and market standing.