The political connection, stakeholders pressure, sustainability reports disclosure, and business risk as moderating variable

Mukhtaruddin (), Hendra Susanto () and Umi Kalsum ()

International Journal of Applied Economics, Finance and Accounting, 2024, vol. 20, issue 2, 188-200

Abstract: The objectives of this research investigated the effect of political connection, stakeholder pressure (environmental pressure, customer’s pressure, employee’s pressure, and foreign pressure) on the sustainability report disclosure and business as a moderating variable. Manufacturing sector companies listed on the Indonesian Stock Exchange for the 2019–2023 periods have a target population. Samples were selected by some criteria, and the 15 manufacturing companies were determined as a sample. The annual report and sustainability report are the sources of the data. To test hypotheses, we are using multiple regression and moderate multiple regression analysis. The employee pressure and environmental pressures do not significantly affect the sustainability report disclosure, while political connections, consumer pressure, and foreign pressure have a significant effect on the sustainability report disclosure. Business risk can moderate the relationship between consumer pressure and sustainability report disclosure, while it cannot moderate the relationship between political connection, environmental pressure, employee’s pressure, and foreign pressure and sustainability reports. The findings of this research have some implications for companies and governments. The company should pay attention to political connections and customer pressure because it can effect a decision related to disclosure of the sustainability reports, and (b) government determines the sustainability report standard.

Keywords: Financial risk; Political connection; Stakeholders pressure; Sustainability reporting disclosure. (search for similar items in EconPapers)
Date: 2024
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