The Effect of Risk and Corporate Governance on Profitability: The Role of Sustainability Report as a Moderator (A Study on Mining Companies Listed in the Indonesia Stock Exchange in the 2013–2020 Period)

DOI

10.2991/978-2-38476-090-9_59How to use a DOI?

Keywords

Risk; Corporate Governance; Sustainability Report; Mining Company

Abstract

This study aims to investigate the role of risk and corporate governance on profitability by utilizing sustainability report as an instrument in determining business sustainability of Indonesian-listed mining companies. The study was carried out by framing 20 mining companies employing the use of time series data in the period between 2013–2020. As means of analysis, a statistical analysis via the use of partial least squares (PLS) was present. The result of this study indicates that risk has a negative effect on profitability. Further, corporate governance has a positive effect on profitability. Despite the significance of risk and corporate governance on profitability, sustainability report had no significance as a moderator. Based on these results, the volatile conditions that occurred in mining stocks in 2013–2020 had a direct impact on profitability, while the sustainability report has not been able to provide a real effect as an instrument that can provide information related to the company's long-term vision and its contribution to protecting the environment can reduce risk, especially for investors in the mining sector, due to the principle of accountability raised in it. This study only focuses on mining companies in Indonesia, so it has not been able to generalize the role of the sustainability report in strengthening investor confidence in all business sectors in Indonesia.

Copyright

© 2023 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Tsabita Karima
AU  - Sri Mangesti Rahayu
AU  - Nila Firdausi Nuzula
AU  - Cacik Rut Damayanti
PY  - 2023
DA  - 2023/08/01
TI  - The Effect of Risk and Corporate Governance on Profitability: The Role of Sustainability Report as a Moderator (A Study on Mining Companies Listed in the Indonesia Stock Exchange in the 2013–2020 Period)
BT  - Proceedings of the Fifth Annual International Conference on Business and Public Administration (AICoBPA 2022)
PB  - Atlantis Press
SP  - 743
EP  - 757
SN  - 2352-5398
UR  - https://doi.org/10.2991/978-2-38476-090-9_59
DO  - 10.2991/978-2-38476-090-9_59
ID  - Karima2023
ER  -