The Effect Of Environmental Performance On Profitability With Environmental Disclosure As Moderating

Abstract

Profitability describes a company's capacity to generate profits. Profitability is typically increased by implementing a nonexistent budget system, reducing marketing expenses, and implementing other asset management strategies. However, asset management is not the only factor affecting profitability in this instance. Environment, society, and economy have a fundamentally interdependent relationship. The company's existence in the environment has direct or indirect effects on the environment and social reality. Additionally, the company has great potential to alter the community's environment; therefore, the company's profitability improvement strategy must incorporate environmental considerations. This study focuses on 15 companies listed on the Indonesia Stock Exchange in 2018-2020 that received environmental performance ratings from PROPER. Quantitative research utilizing secondary data is conducted in the present study. Purposive sampling was used to carry out the sampling technique. Multiple moderation linear regression analysis, classical assumption testing, and hypothesis testing were employed in the investigation. The results indicated that environmental performance had a positive and statistically significant effect on profitability, with a significance level of 0.000. With a significant value of 0.000, the environmental disclosure variable strengthened the relationship between environmental performance and profitability.

Good Corporate Governance and Corporate Social Responsibility on Firm Value

“…The more forms of accountability companies take towards their environment, the company's image in the public view will increase or the company's image will be good (Rachmania, 2017) . Investors are more interested in companies with a good image in society because the better the company's image, the higher consumer loyalty (Ramlawati et al, 2022). As consumer loyalty increases for a long time, the company's sales will improve and in the end, the company's profitability level will also increase.…”

Financial Performance on Firm Value with Corporate Social Responsibility Disclosure as Moderating Variable

“…Mengingat dampak dari buruknya pengelolaan lingkungan yang semakin nyata di Indonesia, maka berbagai permasalahan lingkungan merupakan hal yang penting untuk segera diatasi (Rafianto, 2014;Murdifin et al, 2019;Pasolo et al, 2023). Polemik terhadap masalah lingkungan saat ini menimbulkan pro dan kontra bagi sebagian besar organisasi perusahaan (Ramlawati et al, 2022). Perusahaan menganggap bahwa perhatian terhadap lingkungan sudah menjadi kewajiban, sehingga perusahaan dipaksa untuk melakukan tindakan dalam melindungi atau ikut serta dalam membatasi eksploitasi terhadap alam.…”