How Does Corporate Social Responsibility Disclosure Affect Firm Value: Firm Maturity and Firm Financial Risk Context

Abstract

Corporate Social Responsibility (CSR) is an activity based on altruistic reasons, but CSR disclosure also requires careful consideration so that CSR disclosure becomes a tool that benefits various parties, both for different stakeholders and for the company. This study aims to examine the level of firm maturity and firm financial risk in moderating the relationship between CSR disclosure and firm value. The sample of this research is a non-financial company listed on the Indonesia Stock Exchange. The final sample size is 28 companies consisting of 168 observations from 2014 to 2019. The data in this study were analyzed using multiple linear regression analysis and moderated regression analysis. The results show that CSR disclosure reduces firm value in Indonesia. However, the maturity of the company can moderate the direction of the influence of CSR on firm value from negative to positive at a significant level. Furthermore, the firm financial risk is also able to moderate the direction of the influence of CSR and firm value to be positive and significant. These two moderating variables are empirically important contingency factors in moderating CSR disclosure and firm value in Indonesia. This shows that the influence of CSR and firm value is not entirely positive or negative but is influenced by certain conditions that make CSR disclosure beneficial to all parties. This study is expected to provide an overview for company management to carry out CSR implementation through careful consideration starting from planning to evaluation, to produce CSR disclosures that increase firm value and provide value to all parties.

Effect of Green Accounting, Leverage, Firm Size on Firm Value With Profitability as Intervening Variable

“…There's no clear evidence that green accounting directly affects firm value. The findings confirms previous research by (Nurjanah & Arifa, 2023;Paramita & Ali, 2023), that profitability is not a mediating variable between green accounting and firm value. Even after considering the indirect effect through profitability, the impact of green accounting remains negative and statistically insignificant.…”

“…This study's findings corroborate the findings of prior studies conducted by (Bing & Li, 2019;Fahad & Busru, 2020;Nurjanah & Arifa, 2023), which indicate that green accounting has a detrimental impact and is not statistically significant in relation to business value.…”

“…The findings of several studies (Adiputra & Hermawan, 2020;Alexander, 2023;Faisal et al, 2018;Tanasya & Handayani, 2020;Indriastuti & Chariri, 2021;Nurjanah & Arifa, 2023; Plumlee et al, 2015) indicate a positive and statistically significant relationship between green accounting and firm value. In contrast, alternative research findings suggest that green accounting has a negligible and adverse impact on firm value, as indicated by the conclusions made by (Nurjanah & Arifa, 2023). Additional studies have shown conflicting findings, suggesting that green accounting may have a detrimental impact on business value.…”

“…The findings of previous research conducted (Asni & Agustia, 2022;Tanasya & Handayani, 2020;Paramita & Ali, 2023;Yanto, 2018) suggest that profitability can act as an intervening variable in this relationship. In contrast, alternative research findings suggest that profitability does not serve as a mediating variable in the relationship between green accounting and firm value (Nurjanah & Arifa, 2023;Paramita & Ali, 2023).…”

Does The Relationship between Profitability, Liquidity, and Leverage Toward Firm Value Get Tempered by Dividend Policy?

“…26, No.3, 2023 that hurt firms' value. The intensity of the COVID-19 (Prabowo, 2023) and CSR Disclosure (Nurjanah et al, 2023) impact led to a notable reduction in the value of Indonesian firms.…”