COMPANY CHARACTERISTICS ON THE CORPORATE SOCIAL REPORTING INDEX OF CORPORATE SOCIAL AND ENVIRONMENTAL DISCLOSURE IN INDONESIAN PUBLIC COMPANIES

Asrori Asrori,Atta Putra Harjanto,Muhammad Ihlasul Amal

doi:10.32479/ijeep.7990

Asrori Asrori, Atta Putra Harjanto + Show 1 more

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https://doi.org/10.32479/ijeep.7990

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Abstract

Corporate Social and Environmental Disclosure (CSED) is a form of reporting on the implementation of social and environmental responsibilities that must be included in the company's annual report. However, how extensive or how much information must be delivered is still voluntary. This paper attempts to examine the effect of earnings management, managerial ownership, profitability and firm size on corporate social and environment disclosure. The findings of this study reveal that earnings management, managerial ownership, company size and company profitability have a significant positive effect on the extent of corporate social responsibility and environmental disclosure. This finding encourages the government to stipulate regulations that explicitly and clearly regulate the practice and disclosure, and supervision of Corporate Social Responsibility (CSR) in companies in Indonesia so that the practice and disclosure of CSR in Indonesia is increasing.Keywords: Corporate Social Responsibility, Corporate Social and Environmental Disclosure, public companies, financial indicators.JEL Classification: E44, M14, Q56DOI: https://doi.org/10.32479/ijeep.7990

Highlights

Corporate social responsibility (CSR) is seen as a form of corporate contribution to the community and related parties for social responsibility and the continuity of the company (Handayani et al, 2017)
In a formal juridical manner, the government has obliged companies in Indonesia, especially those listed on the IDX to practice and disclose social and environmental responsibility through Law No 40 of 2007 concerning limited liability companies and Law No 25 of 2007 concerning investment, but the results of the study prove that the level of disclosure of CSR in Indonesia is still relatively low, and the wide variation in disclosures made by manufacturing companies in this study is caused by indications of earnings management, managerial ownership, profitability, and company size
The findings of this study reveal that earnings management has a significant positive effect on the breadth of CSR and environmental disclosure

Summary

Introduction

Corporate social responsibility (CSR) is seen as a form of corporate contribution to the community and related parties for social responsibility and the continuity of the company (Handayani et al, 2017). By adopting the assumption in agency theory that management will behave opportunistically, management can provide excessive information through corporate social and environmental disclosure (CSED) in annual reports to divert the attention of users of financial statements to their earnings management (Wibowo et al, 2019). This was supported by the results of Prior et al (2008) which states that earnings management has a positive impact on CSR disclosure

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