Factors influencing carbon emissions disclosures in high profile companies: some Indonesian evidence

Abstract

The purpose of this article was to examine the influence of ownership structure, environmental performance, financial performance, and company size on carbon emissions reporting of high profile companies in Indonesia. Ownership structure was measured by foreign ownership, institutional ownership, and concentrated ownership, while environmental performance was measured by the Company Performance Rating Program in Environmental Management released by the Ministry of Environment (PROPER) and ISO 14001 certification. The disclosure of carbon emissions was assessed by an index drawn from the carbon disclosures project (CDP). High profiles companies were chosen as the sample since the companies create carbon emissions in their operation which contributes to global climate change. Utilizing 102 companies in 2019 as a sample, results of multivariate regression suggest that institutional ownership and size positively influence the level of carbon emission disclosure. These results indicate that larger companies and companies owned by an institution have a higher tendency to report carbon emissions either in the firm’s annual report or in the sustainability reporting. The findings motivated the listed companies in reporting their carbon emission which is voluntary in nature. Such findings may give an understanding to the capital market regulatory body in releasing regulations that encourage listed companies to report their carbon emission.