The Effect of Inflation and Corporate Social Responsibility on Share Returns with Profitability as Intervening Variables in the Mining Sector: 2017-2019 Period

Verry Allan Dwi Prastyo,Slamet Riyadi,Sunu Priyawan

doi:10.33422/ijarme.v4i1.472

Abstract

This study aims to prove the effect of inflation and corporate social responsibility on stock returns with profitability as an intervening variable in mining listed on the Indonesia Stock Exchange. The population of this study is 47 mining sector companies listed on the Indonesia Stock Exchange (BEI). The sampling technique uses a purposive sampling method which has certain criteria in taking samples that have an annual financial report 2017-2019, in order to obtain 22 companies. mining sector is listed on the Indonesia Stock Exchange (IDX). The method of this research uses analysis of Structural Equation Modeling (SEM) based on variance, namely Partial Least Square (PLS). SEM with variance-based PLS so that it can handle two conditions, namely conditions with undetermined factors and conditions where the solution cannot be accepted. This study uses a computer program from smart PLS 3.2 which is to determine which variables are significant to stock returns in mining listed on the Indonesia Stock Exchange for the 2017-2019 period. The results of this research show that: (1) inflation has a significant effect to stock returns; (2) inflation has a significant impact on profitability; (3) corporate social responsibility has a major impact on stock returns; (4) corporate social responsibility has a significant impact on profitability; (5) profitability has a significant impact on stock returns.

Highlights

The capital market has an important role in the progress of a country's economy, because companies can get funds to support their operations, one of which is through the capital market facilities
The following conclusions can be drawn in this analysis focused on the findings of data analysis on inflation and corporate social responsibility (CSR) on stock returns with profitability as an intervening vector for the Mining sector listed on the Indonesia Stock Exchange (IDX) for the duration 2017-2019
It can be shown, based on the model estimation performance, that: 1. For the 2017-2019 timeframe, inflation has an impact on the return of shares gained by shareholders of mining firms listed on the Indonesia Stock Exchange (IDX). 2

Summary

Introduction

The capital market has an important role in the progress of a country's economy, because companies can get funds to support their operations, one of which is through the capital market facilities. For shareholders or investors, both individuals and companies, the capital market can be a means of investing their funds to get benefits in the form of dividends and capital gains. Companies that sell securities (stocks or bonds)

Objectives

Methods

Conclusion