FACTORS AFFECTING VOLUNTARY DISCLOSURE WITH CORPORATE GOVERNANCE AS MODERATING VARIABLES

Eny Widayawati,Ari Darmawan,Moch Dzulkirom

doi:10.21776/ub.ijabs.2020.28.1.3

Eny Widayawati, Ari Darmawan + Show 1 more

Open Access

https://doi.org/10.21776/ub.ijabs.2020.28.1.3

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Abstract

Purpose — The purpose of this research is to analyze and prove the influence of independent variables that are proxied by profitability, liquidity, firm size on voluntary disclosure, and moderated by corporate governance variables. Design/methodology/approach — The object of the research is the companies listed on the IDX from 2012 through 2016. This research uses a purposive sampling method involving 45 annual company reports and uses multiple regression and MRA (Moderated Regression Analysis) as a data analysis tool. Findings — The results of this research indicate that there is a significant positive effect between liquidity, firm size on voluntary disclosure, there is a significant negative effect between profitability and voluntary disclosure, and corporate governance moderates the relationship between profitability, liquidity, firm size, and voluntary disclosure. Practical Implications — Companies with high liquidity supported by good corporate governance will reduce voluntary disclosures due to the existence of independent commissioners whose positions are still less influential with the board of commissioners and board of directors, in the other hand, companies with low profitability supported by good corporate governance encourage managers to disclose company information more broadly to convince all stakeholders concerned. Originality/value —

Highlights

Information in the business world is the main source of economic decision making
Oktaviani (2016) found that the average voluntary disclosure by manufacturing companies in the IDX for the 2014-2015 period was 39.83%. These findings indicate that the phenomenon of voluntary disclosure in Indonesia is still low
Profitability has a negative effect on voluntary disclosure

Summary

Introduction

Information in the business world is the main source of economic decision making. Information disclosure is an integral part of the company. Company information will be utilized by stakeholders, especially investors for business decision making. Companies that register their shares in the capital market face competition from other companies in terms of securities, terms, and returns offered. Investors need the information to estimate the uncertainty of cash flows in the future. The information submitted by the company is expected to meet all of the investors' needs (Hardiningsih, 2008)

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