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An ESG-Oriented Sustainable Business Model for Paint Industry Supply Chain in Indonesia

Author

Listed:
  • Raden Pujiyono

    (School of Business, IPB University, Bogor 16151, Indonesia)

  • Marimin

    (School of Business, IPB University, Bogor 16151, Indonesia)

  • Arif Imam Suroso

    (School of Business, IPB University, Bogor 16151, Indonesia)

  • Setiadi Djohar

    (PPM School of Management, Menteng, Jakarta 10340, Indonesia)

Abstract

The environmental, social, and governance (ESG) framework is critical for promoting sustainability in industries with substantial environmental impacts, such as the paint industry. Despite its significant contribution to Indonesia’s gross domestic product (GDP), the paint industry faces challenges in adopting ESG principles, including dependency on hazardous materials, reliance on imported raw materials, and limited participation in sustainability initiatives. This study develops an ESG-oriented business model by examining the influence of governance, environmental, and social dimensions on economic performance within Indonesia’s paint industry supply chain. Using structural equation modeling—partial least squares (SEM-PLS) and data from 170 stakeholders, the findings confirm that all three ESG dimensions positively and significantly impact economic outcomes. This model underscores the necessity of integrating ESG principles to enhance resilience, adaptability, and social responsibility while mitigating environmental risks. The study provides actionable insights for policymakers and industry stakeholders to implement ESG-driven strategies that align sustainability goals with economic growth. However, limitations such as geographical scope, short-term analysis, and broad coverage of supply chain activities highlight the need for further research to ensure generalizability and long-term applicability.

Suggested Citation

  • Raden Pujiyono & Marimin & Arif Imam Suroso & Setiadi Djohar, 2025. "An ESG-Oriented Sustainable Business Model for Paint Industry Supply Chain in Indonesia," Sustainability, MDPI, vol. 17(8), pages 1-34, April.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:8:p:3741-:d:1639072
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    References listed on IDEAS

    as
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