Building a Corporate Culture Centered on Environment, Social, and Governance Principles in Indonesian Companies
DOI:
https://doi.org/10.37641/jimkes.v13i6.4411Keywords:
Corporate Culture, ESG, Organizational Identity, Stakeholder Theory, Sustainability, Transformational LeadershipAbstract
The rising global emphasis on Environmental, Social, and Governance (ESG) principles, driven by regulatory pressure, stakeholder expectations, and strategic demands for long-term resilience, has made the internal integration of ESG values into corporate culture an urgent priority for organizations, including those in Indonesia. This study examines how companies in Indonesia build a corporate culture based on environmental, social, and governance principles. The main goal is to explore the process of aligning these principles with the company vision and mission, identify integration challenges, and assess impacts on employee and organizational performance. A qualitative approach with multiple case studies was used in two Indonesian firms, one multinational and one local. Data came from in-depth interviews, document reviews, and observations. Findings show that strong top leadership commitment and a mindset shift are essential to make these principles part of the core business strategy. Key practices include renewable energy investments, vehicle fleet changes to electric, employee health programs, and community water projects. Challenges involve limited regulations and low understanding among business owners. Positive outcomes include higher employee engagement, productivity, and appeal to younger talent. Successful integration turns these principles into organizational identity, creating shared value and competitive advantage through authentic daily practices.
Downloads
References
Abourokbah, S., Bajaba, S., & Yaqub, M. Z. (2024). Leading the green wave: How and when green transformational leadership cultivates employee green creativity. Acta Psychologica, 250(3), 1–12.
Agbakwuru, V., Onyenahazi, O. B., Antwi, B. O., & Oyewale, K. (2024). The impact of environmental, social, and governance (ESG) reporting on corporate financial performance. International Journal of Research Publication and Reviews, 5(9), 3629–3644.
Agustini, N. A., & Purnaningsih, N. (2018). Pengaruh komunikasi internal dalam membangun budaya organisasi. Jurnal Komunikasi Pembangunan, 16(1), 89–108.
Airawaty, D., Setiorini, K. R., Arifah, S., Sari, Y. P., & Sujarweni, V. W. (2025). Bisnis & keberlanjutan: Strategi, teknologi, laporan. Jakarta: PT. Sonpedia Publishing Indonesia.
Albert, S., & Whetten, D. A. (1985). Organizational identity. Research in Organizational Behavior, 7(1), 263–295.
Amiruddin, A., Dargaville, R., Liebman, A., & Gawler, R. (2024). Integration of electric vehicles and renewable energy in Indonesia’s electrical grid. Energies, 17(9), 2037-2064.
Annarelli, A., Catarci, T., & Palagi, L. (2024). The forgotten pillar of sustainability: Development of the S-assessment tool to evaluate organizational social sustainability. New York, NY: Cornell University.
Aslam, M. A. (2024). Sustainable business practices: Integrating environmental, social, and governance (ESG) metrics. International Journal of Business & Computational Science, 1(1), 1–15.
Asnita, R., Artis, A., Tessa, N., Azzura, I. P., Saragih, M. F., Zikri, F., & Qanita, A. (2024). Strategi manajemen public relations dalam membangun reputasi korporat di industri penerbangan Indonesia. Bundling: Jurnal Manajemen dan Bisnis, 1(1), 24–35.
Balmer, J. M. T. (2017). The corporate identity, total corporate communications, stakeholders’ attributed identities, identifications and behaviours continuum. European Journal of Marketing, 51(10), 1472–1502.
Baumgartner, R. J., & Rauter, R. (2017). Strategic perspectives of corporate sustainability management to develop a sustainable organization. Journal of Cleaner Production, 140(1), 81–92.
Bąk, I., Zioło, M., Cheba, K., & Spoz, A. (2022). Environmental, social and governance factors in companies’ business models and the motives of incorporated them in the core business. Journal of Business Economics and Management, 23(4), 837–855.
Buk, B. T. (2016). The role of organizational identity on strategic management applications. In Global business strategies in crisis: Strategic thinking and development (pp. 127–138). Cham: Springer.
Budihard, A., Asraf, A., Nurhayati, A., & Hamida, L. (2024). The effect of transformational leadership on the implementation of the triple bottom line in MSMEs. Jurnal Ilmiah Manajemen Kesatuan, 12(4), 1285–1294.
Crane, A., Matten, D., Glozer, S., & Spence, L. J. (2019). Business ethics: Managing corporate citizenship and sustainability in the age of globalization. Oxford: Oxford University Press.
Damanik, N., Saraswani, R., Hakam, D. F., & Mentari, D. M. (2025). A comprehensive analysis of the economic implications, challenges, and opportunities of electric vehicle adoption in Indonesia. Energies, 18(6), 1384-1398.
Eccles, R. G., & Klimenko, S. (2019). The investor revolution. Harvard Business Review, 97(3), 106–116.
Fisher, M. R., Obidzinski, K., Mota Alves, A., & Ekaputri, A. D. (2024). Commodities and global climate governance: Early evidence from the EU deforestation-free regulation (EUDR). Journal of Environmental Policy & Planning, 24(2), 145–160.
Freeman, R. E., Harrison, J. S., & Zyglidopoulos, S. (2018). Stakeholder theory: Concepts and strategies. Cambridge: Cambridge University Press.
Freeman, R. E., Phillips, R., & Sisodia, R. (2020). Tensions in stakeholder theory. Business & Society, 59(2), 213–231.
Friede, G., Busch, T., & Bassen, A. (2015). ESG and financial performance: Aggregated evidence from more than 2000 empirical studies. Journal of Sustainable Finance & Investment, 5(4), 210–233.
Gillan, S. L., Koch, A., & Starks, L. T. (2021). Firms and social responsibility: A review of ESG and CSR research in corporate finance. Journal of Corporate Finance, 66(3), 889-902.
Gioia, D. A., Corley, K. G., & Hamilton, A. L. (2013). Seeking qualitative rigor in inductive research: Notes on the Gioia methodology. Organizational Research Methods, 16(1), 15–31.
Hendriati, Y., Sufa, S. A., Telaumbanua, E., & Uhai, S. (2024). Analysis of the impact of organizational culture, employee training, and internal communication on employee retention: A case study in the manufacturing industry in Indonesia. International Journal of Business, Law, and Education, 5(1), 644–656.
Laasch, O., & Conaway, R. N. (2015). Principles of responsible management: Global sustainability, responsibility, ethics. Boston, MA: Cengage.
Li, N., Liang, J., & Crant, J. M. (2010). The role of proactive personality in job satisfaction and organizational citizenship behavior: A relational perspective. Journal of Applied Psychology, 95(2), 395–407.
Li, Y., Gong, M., Zhang, X.-Y., & Koh, L. (2018). The impact of environmental, social, and governance disclosure on firm value: The role of CEO power. The British Accounting Review, 50(1), 60–75.
Liang, P., Bommasani, R., Lee, T., Tsipras, D., Soylu, D., Yasunaga, M., Zhang, Y., Narayanan, D., Wu, Y., & Kumar, A. (2022). Holistic Evaluation of Language Models. New York, NY: Cornell University.
Men, L. R., & Yue, C. A. (2019). Creating a positive emotional culture: Effect of internal communication and impact on employee supportive behaviors. Public Relations Review, 45(3), 764-776.
Olanrewaju, O. I. K., Daramola, G. O., & Babayeju, O. A. (2024). Transforming business models with ESG integration: A strategic framework for financial professionals. World Journal of Advanced Research and Reviews, 22(3), 554–563.
Putri, N. P. T. S. E., Merta, I. K., & Yusnimi, N. M. (2024). Analysis of influence transformational leadership, work motivation on performance of state-owned enterprises employees in Bali. Jurnal Ilmiah Manajemen Kesatuan, 12(5), 2025–2032.
Ravasi, D., & Schultz, M. (2006). Responding to organizational identity threats: Exploring the role of organizational culture. Academy of Management Journal, 49(3), 433–458.
Santoso, N. R., Sulistyaningtyas, I. D., & Pratama, B. P. (2022). Transformational leadership during the COVID-19 pandemic: Strengthening employee engagement through internal communication. Journal of Communication Inquiry, 46(4), 1–25.
Setyadi, A., Pawirosumarto, S., & Damaris, A. (2025). Toward a resilient and sustainable supply chain: Operational responses to global disruptions in the post-COVID-19 era. Sustainability, 17(13), 6167-6178.
Shrimali, G., & Tirumalachetty, S. (2013). Renewable energy certificate markets in India: A review. Renewable and Sustainable Energy Reviews, 26(3), 702–716.
Soni, M. (2023). Environmentally specific transformational leadership and pro-environmental behavior: An empirical analysis of energy sector. International Journal of Organizational Analysis, 31(7), 3179–3194.
Ssenyonga, M. (2021). Imperatives for post COVID-19 recovery of Indonesia’s education, labor, and SME sectors. Cogent Economics & Finance, 9(1), 19-39.
Tantalo, C., & Priem, R. L. (2016). Value creation through stakeholder synergy. Strategic Management Journal, 37(2), 314–329.
Tarigan, E. (2025). Role of solar photovoltaic energy in GHG emission reduction within Indonesia’s long-term strategy for low carbon and climate resilience 2050. International Journal of Energy Economics and Policy, 15(2), 421–428.
Vieira, J., Gomes da Costa, C., & Santos, V. (2024). Talent management and generation Z: A systematic literature review through the lens of employer branding. Administrative Sciences, 14(3), 49-60.
Wickert, C., Scherer, A. G., & Spence, L. J. (2016). Walking and talking corporate social responsibility: Implications of firm size and organizational cost. Journal of Management Studies, 53(7), 1169–1196.
