Integrating Islamic Social Reporting (ISR) Into ESG Disclosure

<jats:p>This study examines whether Islamic Social Reporting (ISR) complements ESG/SDG objectives and improves bank performance in Indonesia. Using a bank–year panel of Indonesian Islamic banks over 2017–2024, we estimate two-way fixed-effects models (bank and year dummies) with cluster-robust standard errors at the bank level. Profitability is measured by ROA. The explanatory set includes the ISR composite and three core dimensions—Zakat Performance Ratio (ZPR), Equitable Distribution Ratio (EDR), and Profit-Sharing Ratio (PSR)—with SIZE (ln total assets) and CAR as controls. Classical diagnostics indicate heteroskedasticity (addressed via clustered and HC3 inference) and low multicollinearity (all VIFs &amp;lt; 2.1). Results show that EDR is positively and statistically significant, while the ISR composite, ZPR, and PSR are not significant; SIZE and CAR are positive but not significant. The within-model fit is moderate (≈0.47).</jats:p>