Carbon Emission Disclosure as Mediation of Factors Affecting Firm Value

Abstract

Global warming and climate change is now a common topic and a high priority scale issue in the world, especially related to carbon emissions. This study aims to obtain empirical evidence about the factors that influence the implementation of Carbon Emission Disclosure (CED) and whether CED that is voluntary reporting affects the firm value. This quantitative research using secondary data of 72 manufacturing companies listed on the Indonesia Stock Exchange in 2016-2018. The results of this study indicate that and profitability have a positive effect on the implementation of CED. The Sobel test results also show that CED can mediate the relationship between and profitability on firm value. The analysis also indicates that CED rating has a positive effect on firm value. This result means that investors consider the implementation of CED in the company is a positive thing and get a good market reaction.

Plantation Industry Firm Value: The Factors of Profitability, Leverage, and Company Size

“…The results of this research support the agency theory, which states that high profitability indicates that the company's future prospects are improving (Alifiani & Suryaningrum, 2020), so investors respond to the positive signals given by the company (Musa et al, 2022). Of course, this will also increase the company's value.…”

“…The relationship between profitability and company value based on the regression coefficient shows a positive direction. This is due to increased net profit results, which increases profitability as proxied by ROE (Alifiani & Suryaningrum, 2020). An increase followed this increase in share prices.…”

Do Green Accounting and Carbon Emission Disclosure Affect Stock Return?

“…The disclosure of carbon emissions involves reporting on the efficiency of carbon output, which includes factors such as raw material consumption, labor costs, factory overhead, environmental overhead expenses, and costs related to carbon management standards (Irwhantoko & Basuki, 2016). Carbon emission disclosure has the potential to enhance the company's valuation by enticing investors to consider investing in the company (Alifiani & Suryaningrum, 2020). Carbon emission management often reflects operational efficiency and technological innovation that tends to perform financially well in the long term, which is attractive to investors (Tsa et al, 2022).…”

Carbon Emission and Firm Performance: The Moderating Role of Management Environmental Training

“…Additionally, the data shows that CED ranking positively affects the value of a firm. This outcome indicates that investors think the firm's adoption of CED is a positive idea and that there has been a favorable market response [33]. It is evident that when a nation places increased policy and regulation pressure on businesses to decrease their carbon pollution, these businesses could interact by disclosing carbon data to demonstrate their adherence to the legislative perspective without actually altering their operations in order to preserve their productive viability, thus remaining unchanged in terms of their carbon achievement [34].…”