The Effect of Disclosure of Sustainability Report on Financial Distress with Company Performance as Intervening Variables

Dian Oktarina

doi:10.33005/jasf.v1i02.29

Authors

Dian Oktarina Sekolah Tinggi Ilmu Ekonomi Perbanas Surabaya

DOI:

https://doi.org/10.33005/jasf.v1i02.29

Keywords:

Company’s Performance, Financial Distress, Product Responsibility, Sustainability Report

Abstract

This study examines the effect of sustainability report disclosure on financial distress with company’s performance as an intervening variable. Company’s performance measured by Return on Assets (ROA). Sustainability report disclosure that used in this research were economic, environment, labor practices and decent work, human right, product responsibility, society. The population of this study is non-finance and banking companies listed at IDX. Sample of this research were 29 non-finance and banking companies listed in IDX during 2012-2016. This research used multiple linier regression and logistic regression method for testing hypothesis. The results of this research showed that on first model, sustainability report disclosure doesn't affect the company’s performance. Second model showed that, public responsibility aspect of sustainability report disclosure has negative effects on financial distress. The last model showed that company’s performance doesn’t affects the financial distress. Therefore, company’s performance can’t be used as an intervening variable. The implications of this study theoretically can provide evidence of the theory being tested related to the effect of sustainability report disclosure on financial distress with company’s performance as an intervening variable. Practically, this research is expected to be able to give an overview of the importance of sustainability reports disclosure to be made and published periodically by the company because this is considered to improve the performance of the company which will minimize or prevent companies from financial distress.

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