Corporate Governance, ESG Strategy, and Company Performance in Indonesia Amid the Trade War

This study aims to analyze the role of corporate governance in Indonesia in aligning Environmental, Social, and Governance (ESG) strategies with firm performance amid the dynamics of the global trade war. The research is motivated by the increasing uncertainty in international trade, particularly the U.S.–China trade war, along with domestic regulatory pressures such as Indonesia’s Financial Services Authority Regulation (POJK) No. 51/POJK.03/2017 mandating sustainability reporting. Employing a Systematic Literature Review (SLR) with the PRISMA protocol, the study reviewed 30 articles published between 2018 and 2025 sourced from Scopus, Web of Science, ScienceDirect, Emerald Insight, Taylor & Francis, and Google Scholar. The findings reveal that corporate governance plays a dual role: (1) as a facilitator that enables effective ESG integration to cope with external pressures such as trade wars, and (2) as a mediator or moderator in the relationship between ESG and firm performance. Strong governance mechanisms such as board independence, audit committees, institutional ownership, and gender diversity enhance ESG transparency, strengthen market legitimacy, and improve corporate resilience. Conversely, weak governance may diminish the benefits of ESG initiatives on performance. This study contributes to the literature by integrating the context of trade wars, ESG, and corporate governance into a comprehensive framework, while also offering practical implications for regulators and firms to reinforce governance in response to global challenges.