skip to main content

Moderating effects of SRI-KEHATI on the ESG-corporate value nexus

1Universitas Selamat Sri, Indonesia

2Universitas Gresik, Indonesia

Open Access Copyright 2024 Diponegoro International Journal of Business under http://creativecommons.org/licenses/by-sa/4.0.

Citation Format:
Abstract

Environmental, social, and governance (ESG) activities have become crucial and practical for corporations due to growing concerns over these issues. This research aims to measure the impact of ESG and Dividend Yield (DY) on corporate value (CV), using Tobin's Q ratio as a proxy for CV. We analyzed a sample of 25 companies listed in the SRI KEHATI Index from 2010 to 2019, using panel data methods to assess the relationships between ESG, DY, and CV. Additionally, we examined the SRI KEHATI Index's moderating role in this context. The study found a significant negative relationship between ESG and CV, while DY positively and significantly influenced CV. When the SRI KEHATI Index is used as a moderator, it significantly enhances the positive impact on ESG and CV. This research enhances understanding of the ESG-DY-CV relationship, aiding corporations in strategy formulation and helping stakeholders with investment decisions. Its originality lies in studying the SRI KEHATI Index's moderating effects, providing a foundation for future research.

Fulltext View|Download
Keywords: Keywords ESG, Diveden Yield, Corporate Value, SRI-KEHATI

Article Metrics:

  1. A. Almaqtari, F., Elsheikh, T., Tawfik, O. I., & Youssef, M. A. E.-A. (2022). Exploring the impact of sustainability, board characteristics, and firm-specifics on firm value: a comparative study of the United Kingdom and Turkey. Sustainability, 14(24), 16395. https://doi.org/10.3390/su142416395
  2. Aboud, A., & Diab, A. (2018). The impact of social, environmental and corporate governance disclosures on firm value: Evidence from Egypt. Journal of Accounting in Emerging Economies, 8(4), 442-458. https://doi.org/10.1108/JAEE-08-2017-0079
  3. Agarwal, B., Gautam, R. S., Jain, P., Rastogi, S., Bhimavarapu, V. M., & Singh, S. (2023). Impact of environmental, social, and governance activities on the financial performance of Indian health care sector firms: Using competition as a moderator. Journal of Risk and Financial Management, 16(2), 109. https://doi.org/10.3390/jrfm16020109
  4. Agustia, D., Sawarjuwono, T., & Dianawati, W. (2019). The mediating effect of environmental management accounting on green innovation: firm value relationship. International Journal of Energy Economics and Policy, 9(2), 299-306. https://doi.org/10.32479/ijeep.7438
  5. Bi, M. (2023). Impact of COVID-19 on environmental regulation and economic growth in China: A Way forward for green economic recovery. Economic Analysis and Policy, 77, 1001-1015. https://doi.org/10.1016/j.eap.2022.12.015
  6. Buallay, A. (2019). Is sustainability reporting (ESG) associated with performance? Evidence from the European banking sector. Management of Environmental Quality: An International Journal, 30(1), 98-115. https://doi.org/10.1108/MEQ-12-2017-0149
  7. Chakkravarthy, B., Irudayasamy, F. G., Pillai, A. R., Elangovan, R., Rengaraju, N., & Parayitam, S. (2023). The Relationship between Promoters’ Holdings, Institutional Holdings, Dividend Payout Ratio and Firm Value: The Firm Age and Size as Moderators. Journal of Risk and Financial Management, 16(11), 489. https://doi.org/10.3390/jrfm16110489
  8. Crane, A. D., Michenaud, S., & Weston, J. P. (2016). The effect of institutional ownership on payout policy: Evidence from index thresholds. The Review of Financial Studies, 29(6), 1377-1408. https://doi.org/10.1093/rfs/hhw012
  9. Deng, X., Li, W., & Ren, X. (2023). More sustainable, more productive: Evidence from ESG ratings and total factor productivity among listed Chinese firms. Finance Research Letters, 51, 103439. https://doi.org/10.1016/j.frl.2022.103439
  10. Derwall, J., Guenster, N., Bauer, R., & Koedijk, K. (2005). The eco-efficiency premium puzzle. Financial Analysts Journal, 61(2), 51-63. https://doi.org/10.2469/faj.v61.n2.2716
  11. Desmita, D., & Sihombing, P. (2024). Sustainability, Profitability and Added Value Moderated by Company Value on Stock Returns Sri-Kehati Index. Asean International Journal of Business, 3(1), 62-74. https://doi.org/10.54099/aijb.v3i1.832
  12. Dewi, V. I., & Oriana, F. (2014). Indeks Sri-kehati dan reaksi harga saham emiten terhadap pengumuman indeks SRI-KEHATI (Studi Kasus pada Indeks SRI-KEHATI). Research Report-Humanities and Social Science, 2
  13. Duan, Y., Yang, F., & Xiong, L. (2023). Environmental, social, and governance (ESG) performance and firm value: Evidence from Chinese manufacturing firms. Sustainability, 15(17), 12858. https://doi.org/10.3390/su151712858
  14. Gordon, M. J. (1963). Optimal investment and financing policy. The Journal of finance, 18(2), 264-272. https://doi.org/10.2307/2977907
  15. Gumanti, T. A., Ningrum, I. S., Paramu, H., & Soendjoto, S. (2020). Fundamental Analysis In Indonesia Stock Exchange. Fundamental Analysis In Indonesia Stock Exchange, 9(3), 01-04
  16. Hassel, L. G., & Semenova, N. (2013). The added value of ESG/SRI on company and portfolio levels–What can we learn from research. CSR and beyond–A Nordic perspective, 137-163
  17. Husna, A., & Satria, I. (2019). Effects of return on asset, debt to asset ratio, current ratio, firm size, and dividend payout ratio on firm value. International Journal of Economics and Financial Issues, 9(5), 50-54. https://doi.org/10.32479/ijefi.8595
  18. Jackling, B., & Johl, S. (2009). Board structure and firm performance: Evidence from India's top companies. Corporate Governance: An International Review, 17(4), 492-509. https://doi.org/10.1111/j.1467-8683.2009.00760.x
  19. Jallo, A., & Mus, A. R. (2024). Effect of corporate social responsibility, good corporate governance and ownership structure on financial performance and firm value: A Study in Jakarta Islamic Index. https://doi.org/10.31227/osf.io/wn9uz
  20. Kluza, K., Ziolo, M., & Spoz, A. (2021). Innovation and environmental, social, and governance factors influencing sustainable business models-Meta-analysis. Journal of Cleaner Production, 303, 127015. https://doi.org/10.1016/j.jclepro.2021.127015
  21. Laili, C. N., Djazuli, A., & Indrawati, N. K. (2019). The influence of corporate governance, corporate social responsibility, firm size on firm value: Financial performance as mediation variable. Jurnal Aplikasi Manajemen, 17(1), 179-186
  22. Lee, G. (2006). The effectiveness of international knowledge spillover channels. European Economic Review, 50(8), 2075-2088. https://doi.org/10.1016/j.euroecorev.2005.10.001
  23. Mahirun, M., Jannati, A., Kushermanto, A., & Prasetiani, T. R. (2023). Impact of dividend policy on stock prices. Acta Logistica, 10(2), 199-208. https://doi.org/10.22306/al.v10i2.375
  24. Negara, I. K. (2019). Analisis pengaruh good corporate governance terhadap nilai perusahaan dengan corporate social responsibility sebagai variabelpemoderasi (studi pada indeks sri-kehatiyang listed di BEI). Jmm Unram-Master of Management Journal, 8(1), 46-61
  25. Negara, N. G. P., Ishak, G., & Priambodo, R. E. A. (2024). The Impact of ESG Disclosure Score on Firm Value: Empirical Evidence From ESG Listed Company in Indonesia Stock Exchange. European Journal of Business and Management Research, 9(2), 114-118. https://doi.org/10.24018/ejbmr.2024.9.2.2064
  26. Safriani, M. N., & Utomo, D. C. (2020). Pengaruh Environmental, Social, Governance (ESG) Disclosure Terhadap Kinerja Perusahaan. Diponegoro Journal of Accounting, 9(3)
  27. Sari, R. N., Pratadina, A., Anugerah, R., Kamaliah, K., & Sanusi, Z. M. (2020). Effect of environmental management accounting practices on organizational performance: role of process innovation as a mediating variable. Business Process Management Journal, 27(4), 1296-1314
  28. Shah, M. U., & Guild, P. D. (2022). Stakeholder engagement strategy of technology firms: A review and applied view of stakeholder theory. Technovation, 114, 102460. https://doi.org/10.1016/j.technovation.2022.102460
  29. Sopian, A., Mulya, H., & Mulya, H. (2018). The impact of corporate social responsibility disclosure on firm value. International Journal of Scientific Research and Management, 6(11), 813-823. https://doi.org/10.18535/ijsrm/v6i11.em01
  30. Spence, A. M. (1974). Market signaling: Informational transfer in hiring and related screening processes. (No Title)
  31. Statman, M., & Glushkov, D. (2009). The wages of social responsibility. Financial Analysts Journal, 65(4), 33-46. https://doi.org/10.2469/faj.v65.n4.5
  32. Stiadi, D. (2023). Moderating Environmental, Social, and Governance (ESG) risk in the relationship between investment decisions and firm value. IOP Conference Series: Earth and Environmental Science,
  33. Suganda, T. R., & Sabbat, E. H. (2014). Sinyal profitabilitas dan reaksi pasar modal terkait peningkatan dividen saat laba meningkat. Jurnal Keuangan dan Perbankan, 18(3), 335-344
  34. Suhartoko, Y., & Perwiro, L. H. (2023). Pengaruh Tanggung Jawab Sosial Perusahaan terhadap Nilai Perusahaan dengan Rasio Profitabilitas sebagai Variabel Moderasi pada Perusahaan Terbuka yang tercatat dalam Indeks Sri-Kehati di BEI pada periode 2010-2020. Jurnal Akuntansi, 17(1), 1-22. https://doi.org/10.25170/jak.v17i1.3318
  35. Velte, P. (2020). Does CEO power moderate the link between ESG performance and financial performance? A focus on the German two-tier system. Management Research Review, 43(5), 497-520. https://doi.org/10.1108/MRR-04-2019-0182
  36. Wahl, A., Charifzadeh, M., & Diefenbach, F. (2020). Voluntary adopters of integrated reporting–evidence on forecast accuracy and firm value. Business Strategy and the Environment, 29(6), 2542-2556. https://doi.org/10.1002/bse.2519
  37. Wibowo, L. K. (2020). Pengaruh Pengungkapan Sustainability Report Terhadap Nilai Perusahaan Pada Perusahaan Yang Terdaftar Di Indeks Saham Sri-Kehati Periode 2017-2019 UNIVERSITAS ATMA JAYA YOGYAKARTA]
  38. Zaneta, F., Ermaya, H. N. L., & Nugraheni, R. (2023). HUBUNGAN ENVIRONMENTAL, SOCIAL, AND GOVERNANCE DISCLOSURE, GREEN PRODUCT INNOVATION, ENVIRONMENTAL MANAGEMENT ACCOUNTING TERHADAP FIRM VALUE. JIAFE (Jurnal Ilmiah Akuntansi Fakultas Ekonomi), 9(1), 97-114. https://doi.org/10.34204/jiafe.v9i1.6134
  39. Zia, M. Z. U. R. M., Rehman, U., & Rehman, S. U. (2021). The Impact of Financing Practices, Firm Growth and Dividend Practices on Firm’s Value as Mediated by Profitability. City University Research Journal, 11(3)

Last update:

No citation recorded.

Last update:

No citation recorded.