The Relationship between Sustainability Reporting, E-Commerce, Firm Performance and Tax Avoidance with Organizational Culture as Moderating Variable in Small and Medium Enterprises in Palembang

Abstract

This study aimed to identify the effect of e-commerce and sustainability reporting on tax avoidance and firm performance, as well as determining whether organizational culture acts as a moderating variable in small and medium enterprises in Palembang, South Sumatera, Indonesia. Agency theory and stakeholder theory were employed as a framework. The questionnaires were distributed online to the owners of small and medium enterprises in Palembang; a sample of 211 respondents completed the questionnaire. Partial least square structural equation model regression was used to test and analyze the hypotheses. The results show that sustainability reporting and e-commerce have a positive effect on tax avoidance, while tax avoidance has a positive effect on company performance. However, organizational culture does not act as moderating variable to strengthen the effect of tax avoidance on company performance.

Sustainability reporting: Current state and challenges

“…Thematic analysis also unveils various reporting phenomenon which were explained in conjunction with theories. Prominent theories in the field are Stakeholder theory (Fuadah et al, 2022; Hörisch et al, 2020; Lakhani & Herbert, 2022; Ruiz‐Lozano et al, 2021; Sepúlveda‐Alzate et al, 2021) given by freeman widely used to explain ethical organisation management while considering impact of business decisions on various stakeholders. It talks about influence of values and morals in business management.…”

“…In recent years there has been a growing body of academic literature on sustainability reporting including studies on drivers and barriers to sustainability reporting (Daugaard & Ding, 2022;Dissanayake et al, 2021;Juusola & Srouji, 2022;Wong et al, 2022), the impact of sustainability reporting on organisational performance (Agostini et al, 2022;Ahsan & Qureshi, 2021;Buallay et al, 2020;Fuadah et al, 2022;Giron et al, 2021;Pulino et al, 2022), and the role of sustainability reporting in shaping organisational culture and behaviour (Azmat & Zutshi, 2012;Chirilli et al, 2022;Fuadah et al, 2022;Lahuerta-Otero & González-Bravo, 2018). There has also been increasing research into the use of technology and digital tools for sustainability reporting such as blockchain and artificial intelligence, and their potential to improve quality and transparency of sustainability reporting (Cerchiaro et al, 2021;Pizzi et al, 2022;Tajpour et al, 2022).…”

Mapping sustainability reporting research with the UN's sustainable development goal

“… To decrease agency expenses and maximize organizational value. [ 62 , 41 , 43 , [63] , [64] , [65] ] Signaling theory “Signaler-receiver Relationship” How to leverage an organization's performance to its advantage in the marketplace? To reduce knowledge asymmetry and increase organizational value.…”

Sustainability Reporting: Examining the Community Impact of the S&P500 Companies

“…In the same strand of the literature, Fuadah et al [69] analyze the effect of sustainability reporting on tax avoidance and firm performance in the region of Palembang, Indonesia. Their main findings lead to the conclusion that sustainability reporting positively affects tax avoidance, while tax avoidance has a statistically significant effect on firm performance.…”