Abstract

The issue of environmental impacts caused by the mining industry that listed on the Indonesian stock exchange (IDX) and its handling has still surfaced. This issue has motivated this study to review the effect of Environmental Performance (EP) and Environmental Costs (EC) on Financial Performance (FP) of 12 mining issuers on the IDX with an observation period of nine years (2010-2018). Multiple linear regression analysis with SEM-PLS was utilize to verify the research model. The results show that both of them have a negative correlation, both on environmental performance with financial performance and environmental costs on environmental performance. Environmental impact cases due to the operation of mining companies and the high cost of environmental management may be the causes for the decline in the mining company’s financial performance. Thus, this becomes a dilemma for companies and the government is expected to help them overcome this dilemma.

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