The Impact of Sustainable Finance, Profitability, and Firm Size on Firm Value: The Mediating Effect of Capital Structure in the Indonesian Coal Mining Industry

ABSTRACT: This study analyzes the influence of Sustainable Finance (ESG), profitability, and firm size on capital structure and firm value, and examines the mediating role of capital structure in coal mining companies listed on the Indonesia Stock Exchange (IDX) during 2010–2024. Using a quantitative approach with Structural Equation Modeling–Partial Least Squares (SEM-PLS), the research covers 150 annual observations. ESG positively and significantly influences capital structure and firm value. Profitability has a negative and significant influence on capital structure but shows no significant impact on firm value. Firm size positively affects capital structure yet negatively affects firm value. Capital structure negatively and significantly influences firm value. Mediation analysis shows that capital structure does not significantly mediate the effects of ESG, profitability, and firm size on firm value. These findings indicate that firm value in the coal mining sector is largely driven by sustainability performance and managerial efficiency rather than financing composition.

KEYWORDS: ESG, profitability, firm size, capital structure, firm value, mining sector.