<![CDATA[This study examines the effects of ESG Risk Rating on firm value and financial performance and investigates the moderating role of firm size. A quantitative approach using secondary data was employed. Purposive sampling yielded 17 firms observed from 2021 to 2024, providing 68 firm-year observations. Firm value was proxied by the natural logarithm of market capitalization LNMCAP, financial performance by return on assets ROA, and firm size by the natural logarithm of total assets. Moderated regression analysis was conducted using PROCESS Model 1 in SPSS with HC3 heteroskedasticity-consistent standard errors at the 5 significance level. The results indicate that, at the mean level of firm size, ESG Risk Rating is positively and significantly associated with firm value B 0.0460 p 0.0168, but is not significantly associated with financial performance B 0.0048 p 0.9627. Firm size does not significantly moderate the association of ESG Risk Rating with either firm value interaction B 0.0096 p 0.4067 or financial performance interaction B 0.1045 p 0.0677. Thus, the hypothesis concerning the effect of ESG Risk Rating on firm value is supported within the estimated model, whereas the financial performance hypothesis and both moderation hypotheses are not supported. These findings highlight the importance of distinguishing ESG risk scores from ESG quality and market valuation from profitability. The positive association does not establish that increasing ESG risk causes firm value to increase. Interpretation should account for the limited sample and within-firm dependence that HC3 does not address.]]>
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