Abstract
The aim of this research is to examine the effect of voluntary risk management disclosure and its implication to firm value. Independent variables used in this research are product diversification, geographical diversification, type of industry and company size. Intervening variable is voluntary risk management disclosure. While the dependent variable in this study is firm value measured using Tobin’s Q. This research used a sample of non financial companies listed on the Indonesia Stock Exchange (IDX) in 2019. The sampling method in this research is purposive sampling and acquired 418 companies that meet the criteria. Hypothesis testing using multiple regression analysis. The results of this research showed that the higher the level of product diversification, geographical diversification, type of industry and company size, the higher the voluntary risk management disclosure. Voluntary risk management disclosure has a positive influential on firm value, the wider the disclosure of corporate risk management, will increase the firm value, otherwise the less disclosure of corporate risk management, will decrease the firm value or the value are getting worse.
Highlights
Business activities in recent years have been dynamic, complex and closely interrelated
Based on the results of the research and discussion of the previous chapter, it can be concluded that the results of this research test are: 1. Product diversification has a positive effect on the voluntary risk management disclosure of nonfinancial companies listed on the Indonesia Stock Exchange (IDX) in 2019
Geographical diversification has a positive effect on the voluntary risk management disclosure of non-financial companies listed on the Indonesia Stock Exchange in 2019
Summary
Business activities in recent years have been dynamic, complex and closely interrelated. In the process of achieving goals, there are events that have the possibility to occur. The risk of the business world is directly related to investment activities and company operational activities. Risk management is becoming an increasingly important activity in companies and organizations. Like any other management activity, must be practical, cost effective, and help the organization to survive and grow. The growth of risk management is directly related to the increasing amount of organization risk because it faces complexity (Golberg & Palladini, 2010)
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