The Influences of Sustainability Report and Corporate Governance toward Financial and Entity Market Performance with Political Visibility as Moderating Variable
Keywords:sustainability report, corporate governance, performance profitability, Tobin’s Q, political visibility
The aim of this research was to identify the effect of corporate governance and sustainability report on the financial performance of entities, and corporate governance and sustainability report on the market entity with political visibility as moderating variable. Sustainability report was measured by a dummy variable by the Corporate Governance Scorecard with Indonesian Institute for Corporate Directorship (IICD). Then, financial performance as measured by profitability ratio (ROA) and Liquidity Ratio (CR), as well as the market performance were measured using Tobin’s Q. Meanwhile, the political visibility was measured by the log of total assets. The analysis of the data used Path Analysis method with Structural Equation Modeling (SEM). The analysis shows four results by using political visibility as moderating variable. First, the quality of corporate governance affects the financial performance. Second, the quality of corporate governance influences Tobin’s Q. Third, the sustainability report has an effect on the Return on Assets and current ratio. Last, sustainability report also affects Tobin’s Q.
Alewine, H. C., & Stone, D. N. (2013). How does environmental accounting information influence attention and investment? International Journal of Accounting & Information Management, 21(1), 22-52.
Arcay, M. R. B., & Vazquez, M. F. M. (2005). Corporate characteristics, governance rules, and the extent of voluntary disclosure in Spain. Advances in Accounting, 21, 299-331.
Balabanis, G., Phillips, H. C., & Lyall, J. (1998). Corporate social responsibility and economic performance in the top British companies: Are they linked? European Business Review, 98(1), 25-44.
Belkaoui, A., & Karpik, P. G. (1989). Determinants of the corporate decision to disclose social information. Accounting, Auditing & Accountability Journal, 2(1), 36-51.
Cowen, S. S., Ferreri, L. B., & Parker, L. D. (1987). The impact of corporate characteristics on social responsibility disclosure: A typology and frequencybased analysis. Accounting, Organisations and Society, 12(2), 111-122.
Daniri, M. A. (2008). Standarisasi tanggung jawab sosial perusahaan. Retrieved May 6th, 2016 from http://www.madani-ri.com
Falk, J. (2005). Sustainability reporting and business value
European CEO. Retrieved from http://www.onereport.
Fiakas, D. (2005). Tobin’s Q: Valuing small capitalization
companies. Retrieved from http://smallbusiness.altervista.org/tobins_q_valuing_small_capitalization_companies.php
Gray, R., Javad, M., Power, D. M., & Sinclair, C. D. (2001).
Social and environmental disclosure and corporate characteristics: A research note and extension. Journal of Business Finance & Accounting, 28(3-4), 327-356.
Guidry, R. P., & Patten, D. M. (2010). Market reaction to the first-time issuance of corporate sustainability reports: Evidence that quality matters. Sustainability Accounting, Management and Policy Journal, 1(1), 33-50.
Gunawan, J. (2007). Corporate social disclosures by Indonesian listed companies: A pilot study. Social Responsibility Journal, 3(3), 26-34.
Hasibuan, R. (2001). Pengaruh karakterstik perusahaan terhadap pengungkapan sosial (Master thesis). Universitas Diponegoro.
Katsuhiko, K., Akihiro, N., Yasushi, O., & Tomomi, S. (2001). Determinants of environmental report publication in Japanese companies. In 3rd APIRA conference, Adelaide.
Kuhlman, T., & Farrington, J. (2010). What is sustainability?
Sustainability, 2(11), 3436-3448.
McKinsey & Co. (2002). Global investor opinion survey:
Key finding. Retrieved June 5th, 2016 from http://
Patten, D. M. (1991). Exposure, legitimacy, and social disclosure. Journal of Accounting and public policy, 10(4), 297-308.
Patten, D. M. (1992). Intra-industry environmental disclosures in response to the Alaskan oil spill: A note on legitimacy theory. Accounting, Organisations and Society, 17(5), 71-485.
Pradita, D. (2009). Pengaruh good corporate governance terhadap kinerja keuangan pada perusahaan yang termasuk kelompok sepuluh besar menurut CGPI (Thesis). Universitas Sumatera Utara.
Pranata, Y. (2007). Pengaruh penerapan corporate governance terhadap kinerja keuangan perusahaan (Unpublished Thesis). Universitas Islam Indonesia.
Said, R., Zainuddin, Y. H., & Haron, H. (2009). The relationship between corporate social responsibility and corporate governance characteristics in Malaysian public listed companies. Social
Responsibility Journal, 5(2), 212-226.
Sayidah, N. (2007). Pengaruh kualitas corporate governance
terhadap kinerja perusahaan publik. Jurnal Akutansi dan Auditing Indonesia, 10(1), 1-9.
Scott, W. R. (2009). Financial accounting Theory (5th ed.).
Canada: Prentice Hall.
Soelistyoningrum, J. N. (2011). Pengaruh pengungkapan
sustainability report terhadap kinerja keuangan perusahaan (studi empiris pada perusahaan yang terdaftar dalam Bursa Efek Indonesia) (Unpublished Thesis). Universitas Diponegoro.
Sugiono, A., & Untung, E. (2008). Panduan praktis dasar analisa laporan keuangan. Jakarta: Grasindo.
Yuliani, R. (2003). Pengaruh karakteristik perusahaan terhadap pengungkapan tanggung jawab sosial perusahaan (Master thesis). Universitas Diponegoro.
Authors who publish with this journal agree to the following terms:
a. Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License - Share Alike that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this journal.
b. Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgment of its initial publication in this journal.
c. Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work.
All articles published Open Access will be immediately and permanently free for everyone to read and download. We are continuously working with our author communities to select the best choice of license options, currently being defined for this journal as follows: Creative Commons Attribution-Share Alike (CC BY-SA)