The Effect Of Environmental, Social and Governance (ESG) Disclosure on Firm Performance: The Role of Ceo Tenure
Keywords:CEO Tenure, ESG Disclosure, Financial Performance, Sustainability Performance, Sustainability Reporting
This paper aims to investigate the effect of environmental, social, and governance (ESG) disclosure on firm performance, which is measured by ROE. We also analyze the role of CEO tenure on the relationship between ESG disclosure and ROE. We used 159 samples of public listed companies in Indonesia during period of 2012 to 2016. We employed multiple regression technique to assess the research model. The findings show that ESG disclosure has a positive impact on ROE. The better the quality of ESG disclosure can enhance the level of ROE. In addition, we found a moderating effect of CEO tenure on the relationship between ESG disclosure and ROE. However, CEO tenure plays a role in decreasing the relationship between ESG disclosure and ROE. Our empirical evidence support the process of sustainability investment by using ESG data analysis, to get more comprehensive picture regarding companies sustainability performance. The findings of this study are expected to provide strong evidence regarding the importance of ESG disclosure in enhancing corporate performance. Furthermore, the findings are also expected to be able to ensure potential investors in using ESG disclosure to evaluate corporate sustainability performance.
Jurnal Reviu Akuntansi dan Keuangan is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).