The Influence of ESG Disclosures on Financial Distress Considering The Director's Financial Expertise as a Moderating Factor

Sekar Natasya Prameswari, Novita Novita, Imam Nurcahyo Fambudi

Abstract


 This research aims to examine the relationship between Environmental, Social andGovernance disclosures on Financial Distress and Director's Financial Skills as a moderation. This research method is quantitative. The sample for this research is Consumer Cyclical subsector companies listed on the Indonesia Stock Exchange (BEI) for the 2019 - 2021 period. The research data source uses secondary data from financial reports and company annual reports. The sampling technique was carried out using purposive sampling and a sample of 108 samples was obtained. This research uses a panel regression analysis test with a Random Effect Model. The results show that ESG disclosure has a significant influence on Financial Distress by showing a probability value lower than alpha 5%. The Director's Financial Skills variable is also proven to strengthen the relationship between ESG disclosure and Financial Distress with a profitability value of 0.000 or <5% 

 

This research aims to examine the relationship between Environmental, Social and
Governance disclosures on Financial Distress and Director's Financial Skills as a moderation. This research method is quantitative. The sample for this research is Consumer Cyclical subsector companies listed on the Indonesia Stock Exchange (BEI) for the 2019 - 2021 period. The research data source uses secondary data from financial reports and company annual reports. The sampling technique was carried out using purposive sampling and a sample of 108 samples was obtained. This research uses a panel regression analysis test with a Random Effect Model. The results show that ESG disclosure has a significant influence on Financial Distress by showing a probability value lower than alpha 5%. The Director's Financial Skills variable is also proven to strengthen the relationship between ESG disclosure and Financial Distress with a profitability value of 0.000 or <5%.


Keywords


Current Ratio, ESG, Financial Distress, Financial Expertices of Directors

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References


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DOI: https://doi.org/10.17509/jrak.v12i1.67959

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