The influence of corporate governance elements on the disclosure of sustainability reporting
DOI:
https://doi.org/10.30595/kompartemen.v22i2.23754Keywords:
Sustainability Reporting, Corporate Governance, Commissioners, Independent Commissioners, Directors, Audit CommitteeAbstract
This research aims to provide empirical evidence on the influence of the implementation of corporate governance on sustainability reporting disclosure. The governance components in this study focus on the presence, educational background, and the frequency of board of commissioners, board of directors, and audit committee meetings that contribute to the establishment, implementation, and oversight of sustainability-related company policies. The research sample consists of 78 non-financial sector companies listed on the Indonesia Stock Exchange (BEI) during the period 2020-2022, selected using a purposive sampling method. This research utilizes secondary data sources obtained from the official BEI website, the respective company websites, and S&P Capital IQ to fulfill the data completeness tested with a multiple linear regression model using SPSS application. The research results indicate that the size of the commissioners and the frequency of audit committee meetings have a positive impact on sustainability reporting disclosure. Meanwhile, the research proves that the size of independent commissioners, the size of the board of directors, the size of the audit committee, the educational background of commissioners, the educational background of independent commissioners, the educational background of directors, the frequency of board of commissioners meeting, and the frequency of board of directors meeting do not have a significant impact on sustainability reporting disclosure. The implications of this research can raise awareness among business stakeholders and regulators about the importance of the role of commissioners and the frequency of audit committee meetings in enhancing sustainability reporting practices.
References
A. A. Zaid, M., Wang, M., Adib, M., Sahyouni, A., & T. F. Abuhijleh, S. (2020). Boardroom nationality and gender diversity: Implications for corporate sustainability performance. Journal of Cleaner Production, 251, 119652. https://doi.org/10.1016/j.jclepro.2019.119652
Ahmad, N. B. J., Rashid, A., & Gow, J. (2018). Corporate board gender diversity and corporate social responsibility reporting in Malaysia. Gender, Technology and Development, 22(2), 87–108. https://doi.org/10.1080/09718524.2018.1496671
Al-Qudah, A. A., & Houcine, A. (2023). Firms’ characteristics, corporate governance, and the adoption of sustainability reporting: evidence from Gulf Cooperation Council countries. Journal of Financial Reporting and Accounting. https://doi.org/10.1108/JFRA-02-2023-0066
Aladwey, L., Elgharbawy, A., & Ganna, M. A. (2022). Attributes of corporate boards and assurance of corporate social responsibility reporting: evidence from the UK. Corporate Governance (Bingley), 22(4), 748–780. https://doi.org/10.1108/CG-02-2021-0066
Anyigbah, E., Kong, Y., Edziah, B. K., Ahoto, A. T., & Ahiaku, W. S. (2023). Board Characteristics and Corporate Sustainability Reporting: Evidence from Chinese Listed Companies. Sustainability (Switzerland), 15(4), 1–26. https://doi.org/10.3390/su15043553
Buallay, A., & Al-Ajmi, J. (2020). The role of audit committee attributes in corporate sustainability reporting: Evidence from banks in the Gulf Cooperation Council. Journal of Applied Accounting Research, 21(2), 249–264. https://doi.org/10.1108/JAAR-06-2018-0085
Chams, N., & García-Blandón, J. (2019). Sustainable or not sustainable? The role of the board of directors. Journal of Cleaner Production, 226, 1067–1081. https://doi.org/10.1016/j.jclepro.2019.04.118
Davidson, W. (2020). Financial Statement Analysis: Basis for Management Advice. Wiley.
Dowling, J., & Pfeffer, J. (1975). Organizational Legitimacy: Social Values and Organizational Behavior. Source: The Pacific Sociological Review, 18(1), 122–136.
Elkington, J. (1997). Cannibals With Forks: The Triple Bottom Line 21st Century Business.
Erin, O., & Adegboye, A. (2022). Do corporate attributes impact integrated reporting quality? An empirical evidence. Journal of Financial Reporting and Accounting, 20(3–4), 416–445. https://doi.org/10.1108/JFRA-04-2020-0117
Erin, O., Adegboye, A., & Bamigboye, O. A. (2022). Corporate governance and sustainability reporting quality: evidence from Nigeria. Sustainability Accounting, Management and Policy Journal, 13(3), 680–707. https://doi.org/10.1108/SAMPJ-06-2020-0185
Fogarty, T., & Rezaee, Z. (2019). Business Sustainability, Corporate Governance, and Organizational Ethics. Wiley. wileysgp.ipublishcentral.net
Girella, L., Zambon, S., & Rossi, P. (2022). Board characteristics and the choice between sustainability and integrated reporting: a European analysis. Meditari Accountancy Research, 30Girella,(3), 562–596. https://doi.org/10.1108/MEDAR-11-2020-1111
Githaiga, P. N., & Kosgei, J. K. (2023). Board characteristics and sustainability reporting: a case of listed firms in East Africa. Corporate Governance (Bingley), 23(1), 3–17. https://doi.org/10.1108/CG-12-2021-0449
Hambrick, & Mason. (1984). Upper Echelons : of Reflection The Its Organization as reflection of its Top managers. Management, 9(2), 193–206. http://www.jstor.org/stable/258434
Hu, M., & Loh, L. (2018). Board governance and sustainability disclosure: A cross-sectional study of Singapore-listed companies. Sustainability (Switzerland), 10(7). https://doi.org/10.3390/su10072578
Kumar, K., Kumari, R., Nandy, M., Sarim, M., & Kumar, R. (2022). Do ownership structures and governance attributes matter for corporate sustainability reporting? An examination in the Indian context. Management of Environmental Quality: An International Journal, 33(5), 1077–1096. https://doi.org/10.1108/MEQ-08-2021-0196
Madona, M. A., & Khafid, M. (2020). Pengaruh Good Corporate Governance terhadap Pengungkapan Sustainability Report dengan Ukuran Perusahaan sebagai Pemoderasi. Jurnal Optimasi Sistem Industri, 19(1), 22–32. https://doi.org/10.25077/josi.v19.n1.p22-32.2020
Naheed, R., AlHares, A., Shahab, Y., & Naheed, R. (2021). Board’s financial expertise and corporate social responsibility disclosure in China. Corporate Governance (Bingley), 21(4), 716–736. https://doi.org/10.1108/CG-08-2020-0329
Rachmadanty, A. P., & Agustina, L. (2023). Pengaruh ukuran direksi, dewan komisaris independen, kepemimpinan ganda, jenis perusahaan, sustainability committee, aktivitas perusahaan, kepemilikan asing, dan struktur kepemilikan terhadap sustainability report. Jurnal Riset Ekonomi dan Bisnis, 16(2), 142. https://doi.org/10.26623/jreb.v16i2.5925
Saragih, A. H., Raya, M. N., & Hendrawan, A. (2021). The Moderating Role of Firm Size on the Association between Managerial Ability and Tax Avoidance. Jurnal ASET (Akuntansi Riset), 13(1), 39–49. https://doi.org/10.17509/jaset.v13i1.30783
Setiawan, D., Hapsari, R. T., & Wibawa, A. (2018). Dampak Karakteristik Dewan Direksi Terhadap Pengungkapan CSR. Ekuitas : Jurnal Ekonomi dan keuangan, VIII(1), 1–15.
Tjahjadi, B., Soewarno, N., & Mustikaningtiyas, F. (2021). Good corporate governance and corporate sustainability performance in Indonesia: A triple bottom line approach. Heliyon, 7(3), e06453. https://doi.org/10.1016/j.heliyon.2021.e06453
Triwacananingrum, W., See, B. D. P., Plesley, I. M., & Tedja, J. (2021). the Impact of Corporate Governance on the Tendency of Sustainability Reporting. Jurnal Pendidikan Akuntansi Indonesia, 19(1), 27–34. https://doi.org/10.21831/jpai.v19i1.39240
Utama, S., Fitriany, Siregar, S. V., Rahadian, Y., Utama, C. A., & Simanjuntak, J. (2022). Tata Kelola Korporat di Indonesia (Teori, Prinsip, dan Praktik) (G. Sartika (ed.)). Salemba Empat.
Wijayanti, R., & Setiawan, D. (2023). The role of the board of directors and the sharia supervisory board on sustainability reports. Journal of Open Innovation: Technology, Market, and Complexity, 9(3), 100083. https://doi.org/10.1016/j.joitmc.2023.100083
Zhou, G., Rezaee, Z., Tsui, J., & Cheng, P. (2019). Business Sustainability in Asia. In Business Sustainability in Asia (1st ed.). John Wiley & Sons, Inc.
Downloads
Additional Files
Published
How to Cite
Issue
Section
License
Copyright
You are free to:
Share — copy and redistribute the material in any medium or format for any purpose, even commercially.
Adapt — remix, transform, and build upon the material for any purpose, even commercially.
The licensor cannot revoke these freedoms as long as you follow the license terms.
Under the following terms:
Attribution — You must give appropriate credit appropriate credit, provide a link to the license, and indicate if changes were made . You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use.
No additional restrictions — You may not apply legal terms or technological measures that legally restrict others from doing anything the license permits.
License
1. License to Publish
The article will be governed by the Attribution 4.0 International (CC BY 4.0). The author hereby grants Kompartemen an exclusive publishing and distribution license in the manuscript include tables, illustrations or other material submitted for publication as part of the manuscript (the “Article”) in print, electronic and all other media (whether now known or later developed), in any form, in all languages, throughout the world, for the full term of copyright, and the right to license others to do the same, effective when the article is accepted for publication. This license includes the right to enforce the rights granted hereunder against third parties.
2. Author’s Warranties
The author warrants that the article is original, written by stated author/s, has not been published before, contains no unlawful statements, does not infringe the rights of others, is subject to copyright that is vested exclusively in the author and free of any third party rights, and that any necessary written permissions to quote from other sources have been obtained by the author(s).
3. User Rights
Under the Creative Commons Attribution 4.0 International (CC BY 4.0) license, the author(s) and users are free to share (copy and redistribute the material in any medium or format for any purpose, even commercially.) and adapt (remix, transform, and build upon the material for any purpose, even commercially.). Users must give appropriate credit, provide a link to the license, and indicate if changes were made.
4. Rights of Authors
Authors retain the following rights:
Copyright, and other proprietary rights relating to the article, such as patent rights,
The right to use the substance of the article in future own works, including lectures and books,
The right to reproduce the article for own purposes, provided the copies are not offered for sale, and
The right to self-archive the article.
5. Co-Authorship
If the article was prepared jointly with other authors, the signatory of this form warrants that he/she has been authorized by all co-authors to sign this agreement on their behalf, and agrees to inform his/her co-authors of the terms of this agreement.
6. Royalties
This agreement entitles the author to no royalties or other fees. To such extent as legally permissible, the author waives his or her right to collect royalties relative to the article in respect of any use of the article by Kompartemen or its sublicensee.
7. Miscellaneous
Kompartemen will publish the article (or have it published) in the Journal if the article’s editorial process is successfully completed and Kompartemen or its sublicensee has become obligated to have the article published. Kompartemen Experiences may conform the article to a style of punctuation, spelling, capitalization, and usage that it deems appropriate.
