<![CDATA[Main Objectives: This study analyzes the effect of ESG Risk Rating, inflation, and intellectual capital on the market capitalization of LQ45 companies in Indonesia. This topic is important because sustainability risk, macroeconomic conditions, and intangible assets increasingly shape firm value in emerging capital markets. Background Problems: The research problem is whether these three factors significantly explain differences in market capitalization among leading Indonesian companies. Novelty: The novelty of this study lies in integrating ESG risk, inflation, and intellectual capital in a single valuation model within the Indonesian context, which has rarely been examined simultaneously. Research Methods: Using panel data from 2020–2024 obtained from Sustainalytics ESG Fact Sheets, annual reports, and official inflation statistics, This study employs panel regression and uses a sample of 24 companies, which means the research comprises 120 observations. Finding/Results: The results show that ESG Risk Rating and inflation have not affected market capitalization. Intellectual capital and Firm size as a control variable have a significant positive effect. Meanwhile, Firm age as another control variable has a positive but insignificant effect. However, when the three variables are tested together, they are able to influence market capitalization. Conclusion: Intellectual capital becomes the main factor that can influence market capitalization, both before and after the introduction of control variables. With the results of this research, policies related to human resources should be prioritized, and regulators need to provide education or literacy for investors with a tendency to shift from short-term investments to sustainable investments.]]>
