The Evolution of Environmental Disclosure Practices in Indonesia

Indah Fajarini Sri Wahyuningrum (), Hasan Mukhibad, Shanty Oktavilia, Retnoningrum Hidayah, Andryan Setyadharma and Regina Cahyani Yunita
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Indah Fajarini Sri Wahyuningrum: Universitas Negeri Semarang, Department of Accounting, Faculty of Economics and Business
Hasan Mukhibad: Universitas Negeri Semarang, Department of Accounting, Faculty of Economics and Business
Shanty Oktavilia: Universitas Negeri Semarang, Department of Economics Development
Retnoningrum Hidayah: Universitas Negeri Semarang, Department of Accounting, Faculty of Economics and Business
Andryan Setyadharma: Universitas Negeri Semarang, Department of Economics Development
Regina Cahyani Yunita: Universitas Negeri Semarang, Department of Accounting, Faculty of Economics and Business

A chapter in Proceedings of the International conference of Economics Business and Economics Education Science (ICE-BEES-24), 2024, pp 358-374 from Springer

Abstract: Abstract As part of sustainability principles, stakeholders demanded environmental disclosure practices that led to the business’s environmentally friendly agenda, requiring corporate environmental performance to be measured, accounted for, and disclosed to learn about company environmental risks, consequences, policies, goals, targets, costs, and liabilities. This study explores how much environmental disclosure practices Indonesian public companies have produced since they are still voluntary and moving forward to mandatory disclosure aligned with regulations issued by financial service authorities. Depth analysis, such as preferred information analysis to disclose, based on environmental-sensitive & non-sensitive companies analysis, and sectoral analysis were additionally investigated. This study attempts to show environmental disclosure practices by Indonesian public companies by gathering quantitative information and analyzing the content of companies’ environmental sections in sustainability reports. Over the research period of 2016–2022, the study recorded 756 stand-alone sustainability reports from the companies to explore environmental disclosure trends. The study finds that environmental disclosure practices in Indonesia have fluctuated, with variations in scores yearly. Indonesian public companies mainly prefer to disclose most energy, effluent & waste information. Environmentally sensitive industries perform better on environmental disclosure practices than non-sensitive industries, which presents evidence of the close relationship between environmental disclosure and industry type. Companies in the energy industry have the most outstanding levels of environmental disclosure practices compared to other sectors. Inconsistency in publishing quality indicates that companies can freely determine environmental disclosure, so the government should provide a suitable guideline based on the industry’s characteristics so companies can not avoid essential environmental information.

Keywords: Environmental Disclosure; Indonesian Public Companies; Sustainability Reports (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-522-5_29

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DOI: 10.2991/978-94-6463-522-5_29

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