Abstract
This study aims to analyze the effects of financial performance and environmental performance to firm value with environmental disclosure as an intervening variable. Financial performance which measured by Ratio On Sales (ROS) and environmental performance which measured by PROPER ranking act as independent variables and firm value which measured by stock price acts as dependent variable also environmental disclosure which measured by GRI Standards as an intervening variable. This study uses secondary data and selects the sample used purposive sampling method. The samples consist of non financial companies listed in the Indonesia Stock Exchange (IDX), participated in the PROPER (Program Penilaian Peringkat Kinerja Perusahaan / Performance Rating Assestment Program on Environment Management) and published both annual report and sustainability report for 2017-2018. Partial Least Squares technique is chosen for the study statistic analysis. Results from this research show that financial performance has a negative impact on environmental disclosure, environmental performance has a significant positive impact on environmental disclosure and environmental disclosure does not affect the firm value. Next, the environmental disclosure is not able to intervene the effects of financial performance and environmental performance on firm value. The implications of this research are prove that the environmental aspects of information disclosed by the company have not been an important assessment for investors in viewing the performance of a company and also suggest investors to consider the company's environmental disclosure in making investment decisions because it contain an important aspect of corporate sustainability.
Highlights
The company is established to reach the main goal to maximize the value of the firm.(Kusumayanti and Astika, 2016)
Non-financial companies that listed on the Indonesia Stock Exchange (IDX) 148 2017 - 2018 and participated in the PROPER 2017-2018 100%
Based on all samples that have been tested, the results show that financial performance measured by Ratio On Sales (ROS) has a significantly negative influence to environmental disclosure, environmental performance measured by the PROPER rating has a significantly positive influence on environmental disclosure, whether complete or not the information in environmental disclosures disclosed by companies based on standards does not make the company value increase or decrease, which in this case reflected by the stock price
Summary
Background The company is established to reach the main goal to maximize the value of the firm.(Kusumayanti and Astika, 2016). According to Deswanto and Siregar (2018), the rise of environmental problems that occur such as global warming, natural resources sustainability, waste and pollution makes society which one of the company’s stakeholders more sensitive to environmental issues caused by companies, especially related to pollution so that the public demand for companies to be environmentally responsible in which the company conduct its operation is increasing. It is because the company considered as a party that contribute of causing environmental problems (Runtu and Naukoko, 2014). In Indonesia, the government requires companies to conduct environmental friendly businesses through Law No 40 of 2007 concerning Limited Liability Companies second part article 66 paragraph 6 and article 74 which requires companies to report and implement social and environmental responsibilities as well as through Government Regulation No . 47 of 2012 concerning the Implementation of Corporate Social and Environmental Responsibility (CSR) in particular article 3 which states that social and environmental responsibilities that began in 2012 are obligations for the company
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
