IDEAS home Printed from https://ideas.repec.org/a/eco/journ2/2022-06-12.html
   My bibliography  Save this article

Greenhouse Gas Emission Accounting Disclosure, Corporate Characteristics and Governance: An Empirical Investigation on Indonesian Firms

Author

Listed:
  • Dwi Ratmono

    (Department of Accounting, Faculty of Economics and Business, Universitas Diponegoro, Semarang, Central Java, Indonesia.)

  • Darsono Darsono

    (Department of Accounting, Faculty of Economics and Business, Universitas Diponegoro, Semarang, Central Java, Indonesia.)

  • Nur Cahyonowati

    (Department of Accounting, Faculty of Economics and Business, Universitas Diponegoro, Semarang, Central Java, Indonesia.)

  • Triana Chaerun Niza

    (Department of Accounting, Faculty of Economics and Business, Universitas Diponegoro, Semarang, Central Java, Indonesia.)

Abstract

Currently the world is facing global warming, one of the causes of which is greenhouse gas (GHG) emissions. For these reasons, the disclosure of GHG emission information is one of the interesting research areas. However, previous research generally focused on developed countries with inconsistent findings. In this sense, this study aims to contribute to GHG disclosure by analyzing the characteristics of firms as determinants of GHG emission disclosure in a developing country, Indonesia. This study also analyzed the role of corporate governance consisting of the structure of the board of commissioners and the effectiveness of the audit committee in moderating the effect of corporate characteristics on GHG emission disclosure. The sample consisted of 69 firms-years companies listed on the Indonesia Stock Exchange (IDX). The results of testing with Partial Least Squares-Structural Equation Modeling (PLS-SEM) showed that the structure of the board of commissioners; consisting of indicators of independence, women representation, and the number of members of the board of commissioners; strengthened the leverage effect on GHG emission disclosure. The results of the moderation test also showed that the effectiveness of the audit committee can encourage firms with high leverage and poor performance to reveal more GHG emissions.

Suggested Citation

  • Dwi Ratmono & Darsono Darsono & Nur Cahyonowati & Triana Chaerun Niza, 2022. "Greenhouse Gas Emission Accounting Disclosure, Corporate Characteristics and Governance: An Empirical Investigation on Indonesian Firms," International Journal of Energy Economics and Policy, Econjournals, vol. 12(6), pages 86-95, November.
    • Handle: RePEc:eco:journ2:2022-06-12
    as

    Download full text from publisher

    File URL: https://www.econjournals.com/index.php/ijeep/article/download/13487/6993
    Download Restriction: no
    File URL: https://www.econjournals.com/index.php/ijeep/article/view/13487
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. repec:eme:maj000:02686901311284531 is not listed on IDEAS
    2. Dayuan Li & Min Huang & Shenggang Ren & Xiaohong Chen & Lutao Ning, 2018. "Environmental Legitimacy, Green Innovation, and Corporate Carbon Disclosure: Evidence from CDP China 100," Journal of Business Ethics, Springer, vol. 150(4), pages 1089-1104, July.
    3. Lyton Chithambo & Venancio Tauringana, 2014. "Company specific determinants of greenhouse gases disclosures," Journal of Applied Accounting Research, Emerald Group Publishing, vol. 15(3), pages 323-338.
    4. Walid Ben-Amar & Millicent Chang & Philip McIlkenny, 2017. "Board Gender Diversity and Corporate Response to Sustainability Initiatives: Evidence from the Carbon Disclosure Project," Journal of Business Ethics, Springer, vol. 142(2), pages 369-383, May.
    5. Jose-Manuel Prado-Lorenzo & Isabel-Maria Garcia-Sanchez, 2010. "The Role of the Board of Directors in Disseminating Relevant Information on Greenhouse Gases," Journal of Business Ethics, Springer, vol. 97(3), pages 391-424, December.
    6. Walid Ben‐Amar & Philip McIlkenny, 2015. "Board Effectiveness and the Voluntary Disclosure of Climate Change Information," Business Strategy and the Environment, Wiley Blackwell, vol. 24(8), pages 704-719, December.
    7. Azlan Amran & Vinod Periasamy & Abdul Hadi Zulkafli, 2014. "Determinants of Climate Change Disclosure by Developed and Emerging Countries in Asia Pacific," Sustainable Development, John Wiley & Sons, Ltd., vol. 22(3), pages 188-204, May.
    8. Omaima A.G. Hassan & Peter Romilly, 2018. "Relations between corporate economic performance, environmental disclosure and greenhouse gas emissions: New insights," Business Strategy and the Environment, Wiley Blackwell, vol. 27(7), pages 893-909, November.
    9. Cho, Charles H. & Patten, Dennis M., 2007. "The role of environmental disclosures as tools of legitimacy: A research note," Accounting, Organizations and Society, Elsevier, vol. 32(7-8), pages 639-647.
    10. Pinglin He & Huayu Shen & Ying Zhang & Jing Ren, 2019. "External Pressure, Corporate Governance, and Voluntary Carbon Disclosure: Evidence from China," Sustainability, MDPI, vol. 11(10), pages 1-20, May.
    11. Denis Cormier & Pascale Lapointe-Antunes & Michel Magnan, 2015. "Does corporate governance enhance the appreciation of mandatory environmental disclosure by financial markets?," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 19(4), pages 897-925, November.
    12. Lyton Chithambo & Venancio Tauringana, 2014. "Company specific determinants of greenhouse gases disclosures," Journal of Applied Accounting Research, Emerald Group Publishing Limited, vol. 15(3), pages 323-338, November.
    13. Luo, Le & Tang, Qingliang, 2014. "Does voluntary carbon disclosure reflect underlying carbon performance?," Journal of Contemporary Accounting and Economics, Elsevier, vol. 10(3), pages 191-205.
    14. repec:eme:aaaj00:09513571111184751 is not listed on IDEAS
    15. Elizabeth Stanny, 2013. "Voluntary Disclosures of Emissions by US Firms," Business Strategy and the Environment, Wiley Blackwell, vol. 22(3), pages 145-158, March.
    16. Daniel C. Matisoff & Douglas S. Noonan & John J. O'Brien, 2013. "Convergence in Environmental Reporting: Assessing the Carbon Disclosure Project," Business Strategy and the Environment, Wiley Blackwell, vol. 22(5), pages 285-305, July.
    17. Marco Allegrini & Giulio Greco, 2013. "Corporate boards, audit committees and voluntary disclosure: evidence from Italian Listed Companies," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 17(1), pages 187-216, February.
    18. repec:eme:jaar00:jaar-11-2013-0087 is not listed on IDEAS
    19. Chau, Gerald & Gray, Sidney J., 2010. "Family ownership, board independence and voluntary disclosure: Evidence from Hong Kong," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 19(2), pages 93-109.
    20. Michaela Rankin & Carolyn Windsor & Dina Wahyuni, 2011. "An investigation of voluntary corporate greenhouse gas emissions reporting in a market governance system," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 24(8), pages 1037-1070, October.
    21. Krishnamurti, Chandrasekhar & Velayutham, Eswaran, 2018. "The influence of board committee structures on voluntary disclosure of greenhouse gas emissions: Australian evidence," Pacific-Basin Finance Journal, Elsevier, vol. 50(C), pages 65-81.
    22. Janice Hollindale & Pamela Kent & James Routledge & Larelle Chapple, 2019. "Women on boards and greenhouse gas emission disclosures," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 59(1), pages 277-308, March.
    23. Stephen Bear & Noushi Rahman & Corinne Post, 2010. "The Impact of Board Diversity and Gender Composition on Corporate Social Responsibility and Firm Reputation," Journal of Business Ethics, Springer, vol. 97(2), pages 207-221, December.
    24. Lang, M & Lundholm, R, 1993. "Cross-Sectional Determinants Of Analyst Ratings Of Corporate Disclosures," Journal of Accounting Research, Wiley Blackwell, vol. 31(2), pages 246-271.
    25. Roberts, Robin W., 1992. "Determinants of corporate social responsibility disclosure: An application of stakeholder theory," Accounting, Organizations and Society, Elsevier, vol. 17(6), pages 595-612, August.
    26. Li, Jing & Mangena, Musa & Pike, Richard, 2012. "The effect of audit committee characteristics on intellectual capital disclosure," The British Accounting Review, Elsevier, vol. 44(2), pages 98-110.
    27. Clarkson, Peter M. & Li, Yue & Richardson, Gordon D. & Vasvari, Florin P., 2008. "Revisiting the relation between environmental performance and environmental disclosure: An empirical analysis," Accounting, Organizations and Society, Elsevier, vol. 33(4-5), pages 303-327.
    28. Liao, Lin & Luo, Le & Tang, Qingliang, 2015. "Gender diversity, board independence, environmental committee and greenhouse gas disclosure," The British Accounting Review, Elsevier, vol. 47(4), pages 409-424.
    29. Andreas Andrikopoulos & Nikoleta Kriklani, 2013. "Environmental Disclosure and Financial Characteristics of the Firm: The Case of Denmark," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 20(1), pages 55-64, January.
    30. repec:eme:aaaj00:eum0000000004623 is not listed on IDEAS
    31. Healy, Paul M. & Palepu, Krishna G., 2001. "Information asymmetry, corporate disclosure, and the capital markets: A review of the empirical disclosure literature," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 405-440, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Halil Emre Akbaş & Seda Canikli, 2018. "Determinants of Voluntary Greenhouse Gas Emission Disclosure: An Empirical Investigation on Turkish Firms," Sustainability, MDPI, vol. 11(1), pages 1-24, December.
    2. Le Luo & Qingliang Tang, 2021. "Corporate governance and carbon performance: role of carbon strategy and awareness of climate risk," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 61(2), pages 2891-2934, June.
    3. Córdova Román, Carmen & Zorio-Grima, Ana & Merello, Paloma, 2021. "Economic development and CSR assurance: Important drivers for carbon reporting… yet inefficient drivers for carbon management?," Technological Forecasting and Social Change, Elsevier, vol. 163(C).
    4. Tesfaye T. Lemma & Martin Feedman & Mthokozisi Mlilo & Jin Dong Park, 2019. "Corporate carbon risk, voluntary disclosure, and cost of capital: South African evidence," Business Strategy and the Environment, Wiley Blackwell, vol. 28(1), pages 111-126, January.
    5. Antonio J. Mateo-Márquez & José M. González-González & Constancio Zamora-Ramírez, 2021. "Components of Countries’ Regulative Dimensions and Voluntary Carbon Disclosures," Sustainability, MDPI, vol. 13(4), pages 1-22, February.
    6. Ge Wang & Huijin Zhang & Saixing Zeng & Xiaohua Meng & Han Lin, 2023. "Reporting on sustainable development: Configurational effects of top management team and corporate characteristics on environmental information disclosure," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(1), pages 28-52, January.
    7. Perera, Luckmika & Jubb, Christine & Gopalan, Sandeep, 2019. "A comparison of voluntary and mandated climate change-related disclosure," Journal of Contemporary Accounting and Economics, Elsevier, vol. 15(2), pages 243-266.
    8. Claudio Nuber & Patrick Velte, 2021. "Board gender diversity and carbon emissions: European evidence on curvilinear relationships and critical mass," Business Strategy and the Environment, Wiley Blackwell, vol. 30(4), pages 1958-1992, May.
    9. Faisal Faisal & Erika Dwi Andiningtyas & Tarmizi Achmad & Haryanto Haryanto & Wahyu Meiranto, 2018. "The content and determinants of greenhouse gas emission disclosure: Evidence from Indonesian companies," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 25(6), pages 1397-1406, November.
    10. Bui, Binh & Houqe, Muhammad Nurul & Zaman, Mahbub, 2020. "Climate governance effects on carbon disclosure and performance," The British Accounting Review, Elsevier, vol. 52(2).
    11. Camélia Radu & Nadia Smaili, 2022. "Board Gender Diversity and Corporate Response to Cyber Risk: Evidence from Cybersecurity Related Disclosure," Journal of Business Ethics, Springer, vol. 177(2), pages 351-374, May.
    12. Mumtaheena Anwar & Sohanur Rahman & Md. Nurul Kabir, 2021. "Does national carbon pricing policy affect voluntary environmental disclosures? A global evidence," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 23(2), pages 211-244, April.
    13. Jeanne, Amar & Demaria, Samira & Rigot, Sandra, 2023. "What are the drivers of corporates' climate transparency? Evidence from the S&P 1200 index," Ecological Economics, Elsevier, vol. 213(C).
    14. Grigoris Giannarakis & Andreas Andronikidis & Nikolaos Sariannidis, 2020. "Determinants of environmental disclosure: investigating new and conventional corporate governance characteristics," Annals of Operations Research, Springer, vol. 294(1), pages 87-105, November.
    15. Lily Hsueh, 2019. "Opening up the firm: What explains participation and effort in voluntary carbon disclosure by global businesses? An analysis of internal firm factors and dynamics," Business Strategy and the Environment, Wiley Blackwell, vol. 28(7), pages 1302-1322, November.
    16. Caby, Jérôme & Ziane, Ydriss & Lamarque, Eric, 2020. "The determinants of voluntary climate change disclosure commitment and quality in the banking industry," Technological Forecasting and Social Change, Elsevier, vol. 161(C).
    17. Le Luo & Qingliang Tang & Hanlu Fan & Jamie Ayers, 2023. "Corporate carbon assurance and the quality of carbon disclosure," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 63(1), pages 657-690, March.
    18. Akbas Halil Emre, 2016. "The Relationship Between Board Characteristics and Environmental Disclosure: Evidence from Turkish Listed Companies," South East European Journal of Economics and Business, Sciendo, vol. 11(2), pages 7-19, December.
    19. Jérôme Caby & Ydriss Ziane & Eric Lamarque, 2020. "The determinants of voluntary climate change disclosure commitment and quality in the banking industry," Post-Print hal-02927623, HAL.
    20. Die Wu & Shuzhen Zhu & Aftab Ahmed Memon & Hafeezullah Memon, 2020. "Financial Attributes, Environmental Performance, and Environmental Disclosure in China," IJERPH, MDPI, vol. 17(23), pages 1-14, November.

    More about this item

    Keywords

    Greenhouse Gas Emissions Disclosure; Size; Leverage; Profitability; Governance;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ2:2022-06-12. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.