Corporate Sustainability Determinant Model with Corporate Value in Manufacturing Companies on the Indonesia Stock Exchange (IDX)

Amalia Dewi Ikawati

Abstract


Abstract.This research is motivated by the existence of differences of opinion from previous research that can cause a problem. The purpose of this study is to test and analyze the determinants of corporate sustainability. Therefore, in this study, company value is included as an intervening variable that aims to contribute to the gap in factors that can affect corporate sustainability and as a mediation of the influence of enterprise risk management (ERM), profitability, and corporate leverage on corporate sustainability. This study uses secondary data by taking financial report data and corporate sustainability reports from each manufacturing company on the Indonesia Stock Exchange. The results of the data obtained are processed using E-Views analysis. The results of the analysis inform that Enterprise Risk Management (ERM) has a significant effect on corporate sustainability in manufacturing companies. If the disclosure of enterprise risk management (ERM) increases, it can improve good corporate sustainability and vice versa if the disclosure of enterprise risk management (ERM) decreases, the sustainability of the company will worsen. With the disclosure of enterprise risk management (ERM), it is expected to minimize all risks accepted by the company so that the company can improve corporate sustainability. Profitability has a significant effect on corporate sustainability in manufacturing companies. If the company's profit increases, it can improve the sustainability of the company, conversely, if the company's profit decreases, the company's sustainability cannot be expressed properly and optimally. Company leverage does not have a significant effect on the sustainability of the company in manufacturing companies. If the level of company leverage increases, the level of disclosure of company sustainability will be smaller. Conversely, if the company's leverage is low, the disclosure of company sustainability will be better and increase. Company value is not a mediation of enterprise risk management (ERM) affecting the sustainability of the company in manufacturing companies. Disclosure of enterprise risk management (ERM) has a significant effect on the sustainability of the company without mediation from company value. Company value is not a mediation of profitability affecting the sustainability of the company in manufacturing companies. Profitability has a significant effect on the sustainability of the company without mediation from company value. Company value acts as a mediation of company leverage affecting the sustainability of the company in manufacturing companies. Company value is needed as a mediation of company leverage on the sustainability of the company in manufacturing companies.

 

Keywords: Corporate Leverage; Corporate Sustainability; Corporate Value; Enterprise Risk Management (ERM); Profitability.


Full Text:

PDF

References


Journals:

Ameer, R., & Othman, R. (2012). Sustainability practices and corporate financial performance: A study based on the top global corporations. Journal of business ethics, 108(1), 61-79.

Arinta Chandradinangga, Maria Rio Rita. (2020). Peranan Leverage dan Profitabilitas Terhadap Sustainable Growth: Studi pada Sektor Manufaktur di BEI. International Journal of Social Science and Business. Volume 4, Number 2, Tahun 2020, p. 155-161 P-ISSN : 2614-6533 E-ISSN : 2549-6409.

Asif, A., Rasool, W. and Kamal, Y. (2011), “Impact of financial leverage on dividend policy: empirical evidence from Karachi stock exchange-listed companies”, African Journal of Business Management, Vol. 5 No. 4, p. 1312-1324, doi: 10.5897/AJBM10.838.

Bhatti, A.M., Majeed, K., Rehman, I.U. and Khan, W.A. (2010), “Affect of leverage on risk and stock returns: evidence from Pakistani companies”, International Research Journal of Finance and Economics, Vol. 58 No. 58, p. 32-49.

Camilleri, M. (2017). Corporate sustainability and responsibility: creating value for business, society and the environment. Asian Journal of Sustainability And Social Responsibility, 2(1), 59-74.

Dwi Anggoro Saputro, Fachrurrozie, Linda Agustina.(2013). Pengaruh Kinerja Keuangan Terhadap Pengungkapan Sustainability Report Perusahaan Di Bursa Efek Indonesia.Accounting Analysis Journal(ISSN 2252-6765).

Gill, A. and Mathur, N. (2011), “Factors that influence financial leverage of Canadian firms”, Journal of Applied Finance and Banking, Vol. 1 No. 2, p. 19-37..

Hoyt, R. E., and A. P. Liebenberg. (2006). The Value of Enterprise Risk Management: Evidence from the U.S. Insurance Industry.

Hoyt, R. E., D. L. Moore, and A. P. Liebenberg. (2008). The Value of Enterprise Risk Management: Evidence from The U.S. Insurance Industry. Journal of Financial and Quantitative Analysis, 26, 519-532.

Hoyt, R.E. and Liebenberg, A.P. (2011), “The value of enterprise risk management”, Journal of Risk and Insurance, Vol. 78 No. 4, p. 795-822.

Jarrow, R. (2013), “A leverage ratio rule for capital adequacy”, Journal of Banking and Finance, Vol. 37 No. 3, p. 973-976, doi: 10.1016/j.jbankfin.2012.10.009.

Lin, Y., Wen, M.-M. and Yu, J. (2012), “Enterprise risk management: strategic antecedents, risk integration, and performance”, North American Actuarial Journal, Vol. 16 No. 1, p. 128.

Lindenberg, E. B, and S. A. Ross. (1981). Tobin’s Q Ratio and Industrial Organization. Journal of Business. 54 (1), p. 1-32.

Petra F.A. Dilling. (2010). Sustainability Reporting In A Global Context: What Are The Characteristics Of Corporations That Provide High Quality Sustainability Reports – An Empirical Analysis. International Business & Economics Research Journal – January 2010 Volume 9, Number 1.

Rezaee, Z. (2016). Business sustainability research: A theoretical and integrated

perspective. Journal of Accounting Literature, 36, 48-64.

Ross, W. (2007), Pengantar keuangan perusahaan, 8th ed., Salemba Empat, Jakarta.

Saleem, Q. and Rehman, R.U. (2011), “Impacts of liquidity ratios on profitability (case of oil and gas companies of Pakistan)”, Interdisciplinary Journal of Research in Business, Vol. 1 July, p. 95-98.

Sanjaya, C.K. and Linawati, N. (2015), “Pengaruh Penerapan enterprise risk management dan Variabel Kontrol Terhadap Nilai Perusahaan di Sektor Keuangan”, Finesta, Vol. 3 No. 1, p. 52-57.

Shaheen, S. (2012), “The impact of Capital intensity, size of firm and profitability on debt financing in textile industry of Pakistan”, Interdisciplinary Journal of Contemporary Research in Business, Vol. 3 No. 10, p. 1061-1066. Gill, A. and Mathur, N. (2011), “Factors that influence financial leverage of Canadian firms”, Journal of Applied Finance and Banking, Vol. 1 No. 2, p. 19-37.

Sukamulja, S. 2004. Good Corporate Governance di Sektor Keuangan: Dampak GCG terhadap Kinerja Perusahaan. Benefit: Jurnal Manajemen dan Bisnis, 8 (1), 1-25.

Widjaya, P.E. and Sugiarti, Y. (2013), “Penerapan Risk Management Untuk Meningkatkan Non-Financial Firm Performance Di Perusahaan Murni Jaya”, Calyptra: Jurnal Ilmiah Mahasiswa Universitas Surabaya, Vol. 2 No. 1.

Books:

Decisions: A Survey of Financial Executives. Accounting And Finance Research, 4(2).

Ghozali, Imam. (2017). Analisis Multivariat dan Ekonometrika Teori, Konsep, dan Aplikasi dengan EViews 10. Edisi 2. (Semarang: Fakultas Ekonomi dan Bisnis Universitas Diponegoro).

Gunawan. (2009).”Tanggung Jawab Sosial Perusahaan dan Krisis Global: Mempertahankan Keberlanjutan,” dalam Bisnis Indonesia.

Hanafi, M.M. (2009), Manajemen Risiko, Edisi Kedua, (UPP STIM YKPN : Yogyakarta).

Meyer, K., & Kiymaz, P. (2015). Sustainability Considerations in Capital Budgeting

Moeller, R.R. (2009), Brink’s Modern Internal Auditing: A Common Body of Knowledge, John Wiley & Sons, New York, NY.

Nurlela, R., dan Islahuddin. (2008). Pengaruh Corporate Social Responsibility Terhadap Nilai Perusahaan dengan Prosentase Kepemilikan Manajemen Sebagai Variabel Moderating. Simposium Nasional Akuntansi XI, Pontianak.

Schaltegger, S. (2011). Sustainability as a driver for corporate economic success:

Consequences for the development of sustainability management control. Society and Economy, 33(1), 15-28.

Siahaan, P. (2009), Manajemen Risiko pada Perusahaan dan Birokrasi, PT Gramedia, Jakarta.

Internet:

Global Reporting Initiative 2000-2006. “Pedoman Laporan Keberlanjutan.”, http://www.globalreporting.org.

Meulbroek, L. K. 2002. Integrated Risk Management for the Firm: A Senior Manager's Guide. Retrieved 2008, from Harvard Business School: www.hbs.edu/research/facpubs/workingpapers/papers2/0102/02046.pdf.


Refbacks

  • There are currently no refbacks.


License URL: https://creativecommons.org/licenses/by/4.0/deed.en

Jurnal IAPJ Indexed by :

google_scholar onesearch garuda crosref onesearch  sinta scopus