Determinant of Carbon Emission Disclosure: Empirical Studies on Energy Companies in Indonesia

Abstract

This study intends to investigate the variables, namely company size, profitability, leverage, media exposure, environmental performance, and green strategy, that affect the disclosure of carbon emissions in Indonesia's energy companies that are listed in the Indonesia Stock Exchange (IDX) in 2019-2021 that disclose carbon emission implicit/explicitly. This study used quantitative research method using secondary data obtained from Indonesia Stock Exchange (www.idx.co.id) and the company's website. The company size is measured using total assets natural logarithms of nominal value, whereas profitability is measured using Return on Assets (ROA). The leverage is measured using Debt to Equity Ratio (DER), while the media exposure instrument was dummy variable. The environmental performance is measured using PROPER results from the annual and sustainability report. Measurement of green strategy is done using the Ohlson (2008) index and the carbon emission disclosure is measured using Carbon Disclosure Project (CDP) checklist. The samples are applied using non-probability sampling with purposive sampling technique accompanied by predetermined criteria, with a final sample of 13 energy companies listed in Indonesia Stock Exchange (IDX) and 39 observations during the years 2019-2021. The result of this study provides empirical evidence that media exposure, environmental performance, and green strategy have a positive significant effect on carbon emission disclosure, whereas company size, profitability, and leverage do not have significant effect on carbon emission disclosure.