THE EFFECT OF SOCIAL RESPONSIBILITY ON FINANCIAL PERFORMANCE: ANALYSIS OF FAMILY FIRMS LISTED ON INDONESIA STOCK EXCHANGE IN 2013 - 2020 Ilmidina Kamila, Dony Abdul Chalid, PhD
Universitas Indonesia
Abstract
This study aims to examine the influence of social responsibility disclosure with financial performance in Indonesian companies. The population and samples used in the study are family firms listed in Indonesia Stock Exchange that publish annual reports from 2013 to 2020, except companies in the financial industry, as many as 146 company with a total of 1,168 observations. The method used to test the hypotheses in the study was a multiple regression model. This study uses content analysis to measure social responsibility disclosure (CSD) as an independent variable with reference to the Global Reporting Initiative (GRI) Content Index. Financial performance is a dependent variable which is represented by the proxy of return on asset, return on equity, debt to equity, and Tobin^s Q ratio in measuring firm value. This study also uses corporate governance as control variable. This research found that CSD has a significant effect on firm^s financial performance and firm value. The result shows that CSD had positively influenced a firm^s performance. The findings may be used as a reference for the manager to effectively and efficiently manage CSD, leading to a better firm^s performance.
Keywords: social responsibility disclosure, corporate social disclosure, corporate social responsibility, financial performance, corporate financial performance, family firms.
