Carbon Emissions Disclosure: Financial Performance and Industry Characteristics of companies rated by Morningstar Sustainalytics

Pusvita Indria Mei Susilowati (), Arifuddin, Asri Usman and Syarifuddin
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Pusvita Indria Mei Susilowati: Lambung Mangkurat University
Arifuddin: Hasanuddin University
Asri Usman: Hasanuddin University
Syarifuddin: Hasanuddin University

A chapter in Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024), 2025, pp 2127-2144 from Springer

Abstract: Abstract This study aims to analyze the effect of financial performance and industry characteristics on carbon emission disclosure in companies listed on the Indonesia Stock Exchange (IDX) that have received ESG assessments from Morningstar Sustainalytics. Financial performance variables are measured through profitability and leverage, while industry characteristics are distinguished between industries that produce high (high profile) and low (low profile) carbon emissions. This study uses a quantitative method with secondary data taken from annual reports and sustainability reports in 2023. A total of 68 companies were sampled after outliers were tested. The analysis technique used was multiple linear regression to see the effect of independent variables on carbon emission disclosure. The results of the study show that leverage has a significant and positive effect on carbon emission disclosure, while profitability and industry characteristics do not show a significant effect. Companies with high leverage tend to be more transparent in disclosing carbon emissions as a form of social responsibility and to maintain legitimacy in the eyes of stakeholders. On the other hand, high profitability does not directly encourage companies to increase transparency in carbon emission disclosure.

Keywords: Disclosure of Carbon Emissions; Profitability; Leverage; Industry Characteristics; ESG (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-758-8_170

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DOI: 10.2991/978-94-6463-758-8_170

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