The effect of enterprise risk management on financial performance and firm value: the role of environmental, social and governance performance

Chairani, Chairani; Siregar, Sylvia Veronica

doi:10.1108/medar-09-2019-0549

Cited by 56 publications

(48 citation statements)

References 44 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…To test whether the ESGRISK-SGR relationship between environmentally sensitive and non-sensitive industries is different, we divide the whole company sample into environmentally sensitive and non-environmentally sensitive industries. The business activities of environmentally sensitive industry firms (such as oil, gas, paper, metal manufacturing, and chemical) have a direct impact on ESG issues [66][67][68][69] and are often perceived as polluting sectors that pose higher environmental risks [31,32].…”

Section: Effect Of Esgrisk On Sgr: Environmentally Sensitive Vs Non-sensitive Industriesmentioning

confidence: 99%

Environmental, Social, Governance Risk and Corporate Sustainable Growth Nexus: Quantile Regression Approach

Teng

Wang

et al. 2021

IJERPH

View full text Add to dashboard Cite

Despite a huge body of literature revealing that the effect of environmental, social and governance (ESG) scores on a firms' financial performance and value, it lacks the empirical research on the nexus between corporate sustainable growth and ESG risk in the existing research. The paper aims to examine the nexus between ESG risk and corporate sustainable growth. This study utilizes a quantile regression approach to explore how ESG risk affects corporate sustainable growth (proxied by sustainable growth rate, SGR). The ordinary least squares estimation results confirm that ESG significantly negatively affects corporate sustainable growth. The quantile regression results reveal ESG risk has a significant negative effect on corporate sustainable growth in the upper quantiles of SGR, but not in the lower and median quantiles. The results show that the impact of ESG risk on the corporate sustainable growth is asymmetric and affected by the distribution of SGR. Furthermore, the research results identify that the negative relationship between ESG risk and corporate sustainable growth is particularly apparent for firms in environmentally sensitive industries. This study greatly contributes to existing literature, as with this detailed knowledge, managers can make decisions based on these associations and identify the most lucrative course of action.

show abstract

Section: Effect Of Esgrisk On Sgr: Environmentally Sensitive Vs Non-sensitive Industriesmentioning

confidence: 99%

Environmental, Social, Governance Risk and Corporate Sustainable Growth Nexus: Quantile Regression Approach

Teng

Wang

et al. 2021

IJERPH

View full text Add to dashboard Cite

show abstract

“…Furthermore, for the influence of the second control variable, namely leverage where the results of statistical calculations were known that the leverage variable had a negative and significant effect on return on assets of -0.513 while the leverage variable on the market book ratio has a negative and insignificant effect of -0.318 while the leverage variable on Tobisn q has a negative and insignificant effect on positive and not significant at 0.059. This indicates that investors need a long time to respond to information related to economic, social and environmental issues in sustainability reporting (Chairani and Siregar, 2021;García et al, 2018).…”

Section: Results and Analysismentioning

confidence: 99%

Does sustainability reporting improve financial and non financial performance in Indonesia Companies?

Wahyuningtyas¹,

Susesti²,

Murtadho³

2022

Proceedings of the International Conference on Sustainable Innovation Track Accounting and Management Sciences (ICOSIAMS 2021)

View full text Add to dashboard Cite

Responsibility disclosure of a company is very important for implementing government regulations and public demands related to the disclosure of the company's sustainability in terms of economic, social, environmental which has a major impact on the company's performance in terms of both financial and non-financial. This study aims to examine the impact of sustainability reporting on financial and non financial performance of PROPER companies in Indonesia. The sample used in this study is The sample used in this study were companies which won green industry award that is listed on the Indonesian stock exchange and has published a sustainability reporting in 2015-2020. The secondary data used was taken from financial reports and sustainability reporting in 2015-2020. From this study, it showed that the economic variable has a significant positive effect on financial performance and an insignificant effect on the market and operational performance. Sustainability reports that can be seen from social, economic, and environmental factors are For example, the case of hot mudflow which was caused by Lapindo Brantas Inc., an oil and gas company. Sustainability Reporting Exposure is growing.sustainability report as measured by economics had a positive and significant effect on Tobin's Q, while the social, environmental variables on market performance and company operations affected but it was not significant. While total assets have a significant negative effect on financial performance as measured by Tobin's Q, but have no significant effect on market performance and company operations as measured by MBR and ROA. Leverage has a significant negative effect on ROA but has no significant effect on MBR and Tobin's Q.

show abstract

“…According to signal theory, ESG practices can signal compliance with the norms of sustainable business behavior (Belkaoui, 1976). ESG practices also pay attention to various environmental, social, and governance issues to address areas characterizing sustainable, responsible, and ethical investment (Chairani & Siregar, 2021). When an entity shows behavior that is relevant to the values in society, the entity will get a good assessment from the public (Pham & Tran, 2020).…”

Section: Environmental Social and Governance (Esg) And Foreign Invest...mentioning

confidence: 99%

“…Therefore, investors tend to be more attracted to companies with better ESG performance. Chairani and Siregar (2021) documented that ESG practices in a company can be a strong attraction for foreign investment. Further, research conducted before (Liu et al, 2021) at the level of foreign direct investment in 44 countries revealed that high ESG scores reflect important intangible assets and help the internationalization of companies by promising good governance and management systems and sustainable business prospects.…”

Section: Environmental Social and Governance (Esg) And Foreign Invest...mentioning

confidence: 99%

The Influence of Environmental, Social, and Governance Performance on Foreign Investment

Khodijah

2022

JAI

View full text Add to dashboard Cite

Research aims: This study aims to investigate the effect of environmental, social, and governance (ESG) performance on foreign investment through corporate reputation.Design/Methodology/Approach: This study’s population was all non-financial companies listed on Indonesia Stock Exchange from 2015 to 2019. Moreover, the hypotheses testing technique used was Two-Stage Least Square (2SLS), with 150 observations distributed in balanced panel data. In addition, additional analysis was conducted to examine how each company paid attention to ESG practices based on its industry classification through descriptive statistical analysis.Research findings: The regression results revealed that companies with good ESG performance tended to have a high level of foreign investment. However, it could not be explained by the corporate reputation. In an additional test, this study documented that the mining industry had a much better ESG performance than other industrial groups.Theoretical contribution/Originality: This study pays attention to foreign investment through trading domestic equity shares, whereas previous studies only focused on ESG practices in the FDI process. In addition, this study examined corporate reputation in explaining the relationship.Practitioner/Policy implication: The research results can be used by standard setters in developing sustainability disclosure standards in Indonesia, which International Sustainability Standards Board is currently initiating.Research limitation/Implication: The weakness in this study is the small number of samples employed in the test due to the minimal availability of ESG data in the database.

show abstract

The effect of enterprise risk management on financial performance and firm value: the role of environmental, social and governance performance

Cited by 56 publications

References 44 publications

Environmental, Social, Governance Risk and Corporate Sustainable Growth Nexus: Quantile Regression Approach

Environmental, Social, Governance Risk and Corporate Sustainable Growth Nexus: Quantile Regression Approach

Does sustainability reporting improve financial and non financial performance in Indonesia Companies?

The Influence of Environmental, Social, and Governance Performance on Foreign Investment

Contact Info

Product

Resources

About