Military experienced board and corporate social responsibility disclosure: an empirical evidence from Indonesia

Nasih, Mohammad; Harymawan, Iman; Putra, Fajar Kristanto Gautama; Qotrunnada, Rizka

doi:10.9770/jesi.2019.7.1(39)

Cited by 24 publications

(27 citation statements)

References 33 publications

(61 reference statements)

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“…Our control variables consist of profitability (ROA), leverage (LEV), firm size (FSIZE), firm age (LNAGE), board size (BSIZE), independent commissioner (INDCOM), and public accounting firm size (BIG4). These control variables will be defined in Appendix A and have been used based on prior studies [55,59].…”

Section: Variables Operationalizationmentioning

confidence: 99%

“…An instrumental variable is a variable that has a relationship with the dependent variable, only through an interested variable. Employment of an instrumental variable is also believed to counter the endogeneity issue, specifically for omitted variables [59,64]. Following prior studies [13,63], we employ two instrumental variables, the average value of distressed firms based on their industry year (AVE_DIS) and the lag of ESG reporting (LAG_ESG).…”

Section: Heckman Two-stage Regressionmentioning

confidence: 99%

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Financially Distressed Firms: Environmental, Social, and Governance Reporting in Indonesia

et al. 2021

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This study examines the relationship between financial distress and environmental, social, and governance (ESG) disclosure. We hypothesize that financially distressed firms are tempted to enhance ESG disclosure as it provides higher performance in terms of financial and market perspectives. ESG disclosure needs substantial resources, which financially distressed firms may not be able to provide. In Indonesian settings, we find that financially distressed firms have lower ESG disclosure quality than non-distressed firms. Our results are robust due to lagged variable, Heckman’s two stages, and coarsened exact matching regression showing consistent results. Furthermore, our results are consistent with three years of rolling windows of financial distress and all sections of ESG reporting, except the general information section. This study extends the scope of prior studies by focusing on firms’ eagerness to provide higher quality ESG disclosure, particularly distressed firms.

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Section: Variables Operationalizationmentioning

confidence: 99%

Section: Heckman Two-stage Regressionmentioning

confidence: 99%

Financially Distressed Firms: Environmental, Social, and Governance Reporting in Indonesia

et al. 2021

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“…Based on the preceding fact that the Indonesian government supports their military personnel's involvement in the economic sector, it issued the regulation in 1957 [29]. Since that year, military business activities have become critical in the Indonesian economy [28]. Following that fact, it is interesting to see the current situation of the military-connected board members in responding to the waste issues of mining entities.…”

Section: Introductionmentioning

confidence: 99%

“…Based on that finding, we can interpret that military-connected board members will make more effort to manage the waste from their entity since they tend to be patriotic. With that kind of consistency, they could encourage the management team to devote themselves to handle environmental issues caused by the work of mining entities since the severe environmental case itself will bring disadvantage for the country if there is no effort to handle it [21], [28], [36], and [40] Another research supported by another research states that CEOs with military backgrounds also have more comprehensive leadership skills that could improve the overall performance of the entities. By having those characteristics, militaryconnected board members perceive the ability to make decisions properly since they tend to obey the rules and also able to decide the crisis as if the entity gets the pressure from various aspects for example in social and environmental problems of climate change [21].…”

Section: Introductionmentioning

confidence: 99%

Healthy Environmental Parameters as the Identification of Mining Entities

Sari

Soeprajitno

2021

jak

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Nowadays the biggest global problem in the industry sector is located on environmental issues. This issue committed by the national entities that produced a lot of waste and emission. To answer this problem, the government decided to make a commitment for building policies of zero emission in the year 2050 accompanied with the appeal for disclosing and reporting the Sustainability Report for the entities in the industry sector. This research will elucidate the effort of entities involved for dealing with the global waste issue of industry sector. The involvement will be evaluated in the disclosure that made using the applicable Global Reporting Index scale. This research utilized mining sector entities listed in IDX from 2014 - 2018. Furthermore, this research used content analysis with processing multiple linear regression and applied the software of Stata 14. The outcome of this research is to attain the effort enhancement of improving the mining entities and the disclosure was greatly influenced by certain parameters, so it showed the significant difference from each mining entity. This research is expected could contribute to the government so they are more concerned by paying more attention and making policies to synergize the goal of “zero waste and zero emission” by a healthy-environment-performance basis for the entities, and augment the theory application along with knowledge development of disclosure in form of Sustainability Report. Keywords: Environment; Waste; Emission; Sustainability Report; Mining Entities.

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“…This paper is also related to the literature examining the effect of executive and board member military experience on firm financial reporting and corporate decisions. Managers with military experience are associated with conservative disclosure styles (Bamber et al , 2010), increased corporate social responsibility disclosure (Nasih et al , 2019), less tax avoidance (Law and Mills, 2017), less fraudulent financial reporting and option backdating (Koch-Bayram and Wernicke, 2018), greater merger synergies (Lin et al , 2011), conservative corporate policies (Benmelech and Frydman, 2015), lower interest rates on debt (Iman, 2018) and less corporate philanthropy (Luo et al , 2017). In a related study examining directors with military experience, Simpson and Sariol (2019) find firms facing securities class action lawsuits are more likely to appoint directors with military experience, citing the appeal of their resilience in times of distress.…”

Section: Introductionmentioning

confidence: 99%

Military veterans on the board and executive compensation

Rainville

2020

IJMF

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PurposeThe purpose of this study is to examine the relationship between independent director military service and monitoring effectiveness, focusing on chief executive officer (CEO) compensation.Design/methodology/approachThe authors identify independent directors with military experience using BoardEx data. The authors focus on the level of CEO compensation. The methods used include panel data estimation, propensity score matching analysis and instrumental variable analysis.FindingsThe authors find more powerful CEOs are more likely to appoint independent directors with past military service to the board. Boards with a larger proportion of independent directors with military experience tend to award higher levels of CEO compensation. Moreover, the positive relationship between independent directors with military experience and executive compensation is stronger when the CEO is more powerful.Originality/valueThis paper examines a relatively unexplored director background, directors with military experience, and finds this type of independent director is associated with weak monitoring. The authors contribute to the literature examining the effect of executive and board member military experience on corporations. The authors identify weak monitoring of powerful CEOs as a potential weakness of directors with military experience. This drawback should be considered before appointing a director with military experience to the board.

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Military experienced board and corporate social responsibility disclosure: an empirical evidence from Indonesia

Cited by 24 publications

References 33 publications

Financially Distressed Firms: Environmental, Social, and Governance Reporting in Indonesia

Financially Distressed Firms: Environmental, Social, and Governance Reporting in Indonesia

Healthy Environmental Parameters as the Identification of Mining Entities

Military veterans on the board and executive compensation

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