Sustainable Finance: A Strategy to Increase Good Corporate Governance and Company Value in Banking Industry

Muhammad Tafsir

doi:10.33096/atestasi.v4i2.828

Abstract

This paper aims to examine the effect of sustainable finance on the implementation of good corporate governance and corporate value creation. Environmental damage due to company activities is increasingly worrying. The sustainable finance policy will test the extent to which the implementation of good corporate governance is going well. The success of the sustainable finance policy will ultimately increase the company's value. The results of the analysis show that sustainable finance has a positive impact on the implementation of good corporate governance where sustainable finance will be successful if corporate governance is well implemented, as well as corporate value, where investors or the public will have a positive influence on the company's seriousness in implementing financial programs. sustainable and corporate value. This study is hoped to be an input for the government and banks in supporting environmental protection.

Highlights

Investment is an activity to invest capital in the present
From the formulation of the proposed research problem, the data analysis that has been carried out can be drawn several conclusions, namely: Based on a simple linear regression analysis, it turns out that the results of the study show a regression equation, namely Y = 20,673 + 0.684 + 0.468, which means that if the implementation of Sustainable Finance is carried out consistently it will affect the improvement of Good Corporate Governance and Company Value, respectively 68,4 and 46,8% in banking development
This study has tried to describe the effect of implementing sustainable finance on good corporate governance and corporate value in the banking industry in Indonesia, limitations are found in this study

Summary

Introduction

Investment is an activity to invest capital in the present. It is expected to get a return in the form of future profits where investment can be made in the way of financial assets or real assets (Yuniningsih, Pertiwi, & Purwanto, 2019). (Pertiwi, Yuniningsih, & Anwar, 2019), and psychological factors considerations owned by individual investors are things to consider such as overconfidence, disposition and risk tolerance, raming effects, reference dependence, loss aversion, overreaction, underreaction in making investment decisions (Mittal, 2010). The development of an increasingly developing economic development must be able to go hand in hand with various aspects such as environmental sustainability, economic transformation, overcoming poverty and creating justice. This is what encourages the United Nations (UN) to collaborate with countries in the world, businesses and communities to create a sustainable development framework. The negative impacts arising from the economic development process have prompted the initiation of sustainable development that prioritizes harmony in economic, environmental, and social aspects

Objectives

Discussion

Conclusion