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Feb 3, 2025
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Dec 27, 2024
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Abstract

This study addresses the gap between the theoretical expectation that sustainability investments enhance financial performance and the lack of observed direct impact, raising the question of whether such expenditures directly improve profitability. The study aims to examine the impact of capital expenditure on sustainability technology on profitability, measured by profit per BOE, focusing on the energy company ENI during the 2018–2022 period, with ROA as a moderating variable. Using a quantitative approach with the SEM-PLS method, this research analyzes five years of company data (2018–2022) to explore the relationships between variables. The novelty lies in challenging common assumptions by revealing that the moderating effect of ROA and the direct influence of capital expenditure on profit per BOE are not significant, highlighting an underexplored area in sustainability investment research. The findings indicate that although the model explains 90.9% of the variability in profit per BOE, the anticipated financial benefits of sustainability investments are not directly evident, suggesting a misalignment between theoretical assumptions and practical outcomes. This study concludes that while sustainability investments are essential for long-term objectives, their short-term profitability requires further investigation, providing practical insights for corporate decision-making and policy development.

Keywords

Return on Assets Profit per Barrel of Oil Equivalent Capital Expenditure for Sustainability Technology SEM-PLS

Article Details

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This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite
Meliza, J., Erlina, E., Fachrudin, K. A., & Irawati, N. (2024). The Impact of Capital Expenditure for Sustainability Technology on Profit per Barrel of Oil Equivalent (BOE) with ROA as a Moderator: A SEM-PLS Approach. Fin Sinergy: Jurnal Manajemen Keuangan, 2(2), 159-167. https://doi.org/10.56457/fin.v2i2.708

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