Aditya Pandu Wicaksono, Hadri Kusuma, Fitra Roman Cahaya, Anis Al Rosjidi, Arief Rahman and Isti Rahayu
This study aims to investigate the effect of the classification of origin country of institutional shareholder (domestic, developed and developing country) and its status on stock…
Abstract
Purpose
This study aims to investigate the effect of the classification of origin country of institutional shareholder (domestic, developed and developing country) and its status on stock exchange (listed and unlisted) on environmental disclosure level in Indonesian companies.
Design/methodology/approach
The data set comprises 474 non-financial firms listed in Indonesian Stock Exchange (IDX) for the period of 2017 to 2019. The study uses an environmental disclosure checklist to measure the extent of environmental disclosure in companies’ reports. Panel regression analysis technique is adopted to investigate the association between total percentage of shares held by institutional shareholders based on the classification of origin country and the status in stock exchange, and the extent of environmental disclosure.
Findings
The study reveals that the extent of environmental disclosure is positively and significantly associated with institutional investors from domestic, developed countries, listed and unlisted institutional investors. Further analysis shows interesting results that institutions from developing countries have a negative and significant relationship with environmental disclosure in non-sensitive industries.
Research limitations/implications
The authors recognize the issue of authors’ subjectivity in the measurement process of environmental disclosure. The sample for this study encompasses Indonesian listed firms. Thus, the results may not be generalized to Indonesian unlisted firms and other countries or regions.
Practical implications
This study suggests managers to engage more with institutional shareholders because they have greater concern for environmental disclosure practices. The current study also suggests managers to make strong environmental policies as they are important to ensure that institutional shareholders’ investments are safe.
Social implications
Given the positive impact institutional shareholders have on the level of environmental disclosure, it indirectly indicates that institutional shareholders have a strong motivation to make the world a better place.
Originality/value
This study offers in-depth insights into the effect of institutional ownership on environmental disclosure based on the classification of origin country and listing status of institutional investors.
Details
Keywords
Muhammad Iqbal, Hadri Kusuma and Sunaryati Sunaryati
This research evaluated the impact of credit risk, liquidity risk, profitability, economic growth and good governance on the vulnerability of the Islamic banking system in the…
Abstract
Purpose
This research evaluated the impact of credit risk, liquidity risk, profitability, economic growth and good governance on the vulnerability of the Islamic banking system in the Association of Southeast Asian Nations (ASEAN).
Design/methodology/approach
The panel regression analysis was used to obtain data from five ASEAN countries that had operated Islamic banks from 2010 to 2019.
Findings
The results obtained from the vulnerability model indicated that bank liquidity risk, profitability and good governance have significant impacts on vulnerability. Conversely, credit risk and economic growth showed an insignificant effect on susceptibility. Good governance helps increase investment attractiveness for economic growth and development in Islamic banks in ASEAN.
Research limitations/implications
Some of the limitations of this research include its focus on the vulnerability of Islamic banks in ASEAN countries. The average value of six indices is used as a single index per country with good governance. Therefore, further research needs to consider using all six indices of good governance as factors affecting the vulnerability of Islamic banks, such as control of corruption, government effectiveness, political stability, absence of violence, regulatory quality, the rule of law voice and accountability.
Practical implications
This research describes banking financial circumstances and their internal activities. Furthermore, it helps managers or banking practitioners in the proper management of finance, specifically at the vulnerability level, to aid in the early detection of crisis to enable early aversion or minimal impact.
Social implications
This research is expected to assist governments in ASEAN countries to establish public policies and build good governance to increase investment interest in the Islamic banking industry.
Originality/value
This research is the author's first attempt at discussing the issues of bank vulnerability related to good governance faced by the Islamic banking system in ASEAN.