Determinants of Environmental Disclosure in Indonesia

Abstract

Environmental disclosure is the disclosure of information relating to the environment in the company's annual report. This disclosure aim is as a medium among companies, communities and investors that can be used as economic, social and political decision making. Industry type, company size, profitability, liquidity, environmental management systems, taxes, market share, and media coverage were considered to have influences on environmental disclosure. The study used quantitative analysis techniques with multivariate regression. The object of this research was the mining sector. The results showed that media coverage had a positive effect on environmental disclosure. This is because media coverage is a key communication function and is very important for management in CSR disclosure. In fact, communicating CSR through the media will enhance the company's reputation in the eyes of the public. The results of this study also indicated that environmental disclosure by companies in Indonesia was still relatively low. Therefore, companies need to increase their environmental disclosure in the annual report or sustainability report. Environmental disclosure is important for the company because it ensures transparency and accountability for the performance and long-term sustainability of the company. Keywords—Environmental Disclosure; Industry Type; Company Size; Financial Performance; Environmental Management System; Political Cost; Media Coverage