The Quality of CSR Disclosure: Effect of Environmental Performance, Slack Resources, and Sensitivity Classification
1Ni Wayan Yantiari, 2Putu Sri Harta Mimba
1,2Faculty of Economics and Business, Universitas Udayana, Indonesia
https://doi.org/10.47191/jefms/v7-i9-17ABSTRACT:
This study aims to analyze the influence of slack resources, environmental performance, and industry sensitivity on the quality of Corporate Social Responsibility Disclosure (CSRD) in Energy and Basic Materials sector companies listed on the Indonesia Stock Exchange (IDX) during the period 2017 to 2023. Using a quantitative approach and explanatory research design, data was collected from annual reports, sustainability reports, and PROPER ratings from the Ministry of Environment. The results show that slack resources have a positive and significant effect on the quality of CSRD. Companies with higher slack resources tend to have better quality CSR disclosures. Environmental performance also has a positive effect on CSRD quality, where companies that achieve higher PROPER ratings show better CSR reporting. In addition, industry sensitivity has a positive effect on CSRD quality, which suggests that firms in environmentally sensitive industries tend to provide higher quality CSR disclosures to maintain legitimacy and reputation. Control variables Institutional Ownership and Company Size are not able to control the influence of the relationship between Environmental Performance, Slack Resources and Industry Sensitivity on the quality of Corporate Social Responsibility Disclosure (CSRD). These findings provide empirical evidence on the importance of slack resources, environmental performance, and industry sensitivity in improving the quality of CSRD, and offer valuable insights for corporate management and policy makers.
KEYWORDS:
Corporate Social Responsibility Disclosure Quality, Slack Resources, Environmental Performance, Industry Sensitivity, PROPER.
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