Carbon Emission Disclosure in the Proper Rating Company's Annual Financial Statements in Indonesia Stock Exchange

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doi:10.7176/rjfa/10-12-08

Abstract

Annual Reporting is a media for companies that initially only report financial aspects, but now also report on social and environmental aspects. The shift in determining the value of this company along with the emergence of issues of natural and environmental damage. Environmental issues are increasing, accounting also evolves by giving birth to the concept of green accounting and sustainability reporting.This study aims to analyze the effect of PROPER, media exposure, company size, profitability and leverage on Carbon Emission Disclosure. The population in this study is a participant company PROPER 2014-2017. The results of this study show that PROPER, Media Exposure, and Profitability have a significant positive effect on Carbon Emission Disclosure, while company size and leverage do not have a significant effect on Carbon Emission Disclosure. Keywords : Carbon Emission Disclosure, PROPER, Media Exposure, Company Size, Profitability, and Leverage. DOI : 10.7176/RJFA/10-12-08 Publication date :June 30 th 2019

Highlights

Indonesia contributes carbon emissions of 2,053 billion tons. This fact makes Indonesia committed to reducing carbon emissions based on Presidential Regulation No 61 of 2011 article 4 concerning the National Action Plan for Reducing Greenhouse Gas Emissions (RAN-GRK)
Effect rank of PROPER to Carbon Emission Disclosure Based on the results of the test it can be concluded that PROPER has a positive effect on Carbon Emission Disclosure, this result means that companies that have a high proper rating mean that the company has been active in tackling environmental problems and contributing directly to environmental conservation, the company will have initiatives to disclose information about the environment, especially carbon emissions in annual reports to inform their environmental performance which will be indirectly observed by external parties
Based on the results of the test it can be concluded that Profitability has a positive effect on Carbon Emission Disclosure, this result means that companies with good financial conditions are able to pay for additional human or financial resources needed for voluntary reporting and disclosure of carbon emissions

Summary

Leverage

Effect rank of PROPER to Carbon Emission Disclosure Based on the results of the test it can be concluded that PROPER has a positive effect on Carbon Emission Disclosure, this result means that companies that have a high proper rating mean that the company has been active in tackling environmental problems and contributing directly to environmental conservation, the company will have initiatives to disclose information about the environment, especially carbon emissions in annual reports to inform their environmental performance which will be indirectly observed by external parties These results are supported by the legitimacy theory which reveals that there is a tendency for companies that have good environmental performance to conduct environmental disclosures. One of the more quality sustainability reports is more complete with environmental disclosures, especially regarding carbon emissions These results are not in line with the Pardini (2013) study, the results of testing the size of the company have a significant effect on carbon emissions disclosure. Ghazali (2015) the size of the company has a significant positive influence on carbon emissions disclosure

Effect Profitabilitas to Carbon Emission Disclosure

Findings

Effect Leverage to Carbon Emission Disclosure