Does Financial Performance Drive Environmental Disclosure and Environmental Cost? Evidence from Indonesia

  • Rima Kusuma Rini Universitas Indonesia
  • Desi Adhariani Universitas Indonesia

Abstract

This study examines whether financial performance affects environmental disclosures and environmental costs. Samples from mining and energy companies that are listed on the Indonesia Stock Exchange from 2015 to 2019 were analyzed using the content analysis method and ordinary least square regression.  This study finds that financial performance bears a positive relationship to environmental costs that indicates whether assets are efficiently used as a basis to engage in spending on environmental activities. There is a negative relationship between financial performance and environmental disclosure and a positive relationship between environmental cost and environmental disclosures. This study implies wider stakeholder understanding of how financial performance affects environmental cost and disclosure.  The study implies a role of the cost element in the relationship between financial performance and environmental disclosure.

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Author Biographies

Rima Kusuma Rini, Universitas Indonesia

Department of Accounting, Faculty of Economics and Business, Universitas Indonesia

Desi Adhariani, Universitas Indonesia

Department of Accounting, Faculty of Economics and Business, Universitas Indonesia

Published
2021-07-25
How to Cite
RINI, Rima Kusuma; ADHARIANI, Desi. Does Financial Performance Drive Environmental Disclosure and Environmental Cost? Evidence from Indonesia. Jurnal Ilmiah Akuntansi dan Bisnis, [S.l.], v. 16, n. 2, p. 317-331, july 2021. ISSN 2303-1018. Available at: <https://ojs.unud.ac.id/index.php/jiab/article/view/68265>. Date accessed: 27 sep. 2021. doi: https://doi.org/10.24843/JIAB.2021.v16.i02.p09.
Section
Articles