Purpose: The study examines how foreign board members and a sustainability committee affect carbon emission disclosure (CED) in Indonesian firms. The study posits that firms with governance structures comprising foreign directors and foreign commissioners, supported by a sustainability committee, are more likely to enhance their commitment to transparent CED information to the public. Methods/Study design/Approach: The study employs unbalanced panel data from 2,893 firm-year observations of non-financial companies listed on the Indonesia Stock Exchange (IDX) over the 2014-2023 period. The hypotheses are tested using fixed-effects regression and moderation analysis. The data were obtained from official IDX publications and corporate websites. Result/Findings: The findings indicate that the presence of foreign directors actually lowers the CED because they focus more on creating economic value than on voluntary disclosure, thereby making the monitoring of sustainability practices less effective. However, this negative effect can be transformed into a more positive one if the company has a sustainability committee, which acts as a governance mechanism to provide information, coordination, and monitoring, in line with agency theory, thereby helping foreign directors understand sustainability issues and mitigating their shortcomings in the Indonesian context. Novelty/Originality/Value: Specific research examining the relationship between foreign directors, foreign commissioners, and sustainability committees on CED in Indonesia is still limited.
Purpose: The study critically examines whether financial efficiency ratios in local government financial reports genuinely reflect government performance or primarily indicate fiscal compliance. Within Indonesia’s decentralized governance framework, we investigate the relationship between expenditure realization, environmental outcomes, and reported financial efficiency. Method: An explanatory quantitative approach was utilized, employing balanced panel data from 34 provinces in Indonesia from 2020 to 2023. Financial performance was measured using the efficiency ratio. Regional expenditure was assessed using the expenditure realization ratio, and environmental performance was evaluated using the Environmental Quality Index (EQI). Total revenue was accounted for as a control variable. Panel regression analysis was conducted, and the appropriate estimation model was identified using the Chow and Hausman tests. Findings: Regional expenditure significantly predicts financial efficiency, confirming the ratio’s mechanical sensitivity to budget execution. However, environmental performance shows no significant association with financial efficiency, while fiscal capacity demonstrates a strong negative relationship. The limited explanatory power suggests efficiency ratios primarily capture fiscal compliance rather than substantive policy outcomes. Novelty: The study provides empirical evidence by comparing accounting-based financial efficiency indicators with outcome-based environmental performance measures, demonstrating that financial efficiency ratios primarily reflect fiscal compliance rather than substantive policy outcomes.
Purpose: The study examines the influence of Environmental, Social, and Governance (ESG) performance and ESG controversies on market capitalization and explore the potential moderating role of regulatory quality among publicly listed companies in Southeast Asia. Methods/Study design/Approach: Using a quantitative approach and Fixed Effects Model with robust standard errors, this study analyzes unbalanced panel data of 771 companies across seven Southeast Asian countries (2015–2025) sourced from Refinitiv Eikon and the World Bank. Data were analyzed using panel data regression and Moderated Regression Analysis (MRA) with the Fixed Effects Model. Result/Findings: Our findings reveal that ESG performance positively affects market capitalization. Intriguingly. Baseline estimations show that ESG controversies (where lower scores indicate higher controversy) positively influence market capitalization, suggesting that emerging markets in Southeast Asia may prioritize financial return or media visibility over ESG-related controversy risks. However, regulatory quality strengthens the positive valuation of high ESG performance while servings as a crucial institutional boundary condition that dampens this anomalous market valuation of controversial firms. Novelty/Originality/Value: Moving beyond previous studies focusing on national culture or takeover vulnerability, our study becomes one of the earliest studies that introduces a comprehensive institutional framework by simultaneously examining ESG performance, controversies, and the conditional buffering mechanism of country-level regulatory quality.
Purpose: The study investigates the effect of Environmental, Social, and Governance report on market performance and also examines the moderating effect of corporate governance quality in this relationship. Methods/Study design/Approach: The analysis used panel data from 2018 to 2023, covering nonfinancial firms that registered in the Taiwan Stock Exchange (TWSE) and OTC market. Using 13,119 firm-year observations, we employ fixed-effects regressions with firm and year effects model Result/Findings: Higher ESG disclosure is associated with stronger market valuation. Corporate governance quality significantly enhances this effect, indicating that credible governance improves the value relevance of ESG information. When the ESG components are entered separately, the social pillar shows the strongest association with market value. Robustness checks that exclude the COVID-19 years confirm the stability of these results. Novelty/Originality/Value: The paper enhances the existing ESG literature by emphasizing the significance of corporate governance quality in optimizing the advantages of ESG disclosure. This paper also comparing the three ESG pillars within one framework. The Taiwanese evidence offers policy-relevant insights for ASEAN markets seeking to improve ESG disclosure and corporate governance to reinforce investor trust.
Purpose: The study investigates the relationship between greenwashing, political connections, and fraudulent financial statements in the Indonesian banking sector, with independent commissioners serving as a moderating variable. Methods/Study design/Approach: The study uses panel data from 434 bank-year observations of Indonesian commercial banks during 2016–2022. Fraud is measured using the F-Score and Beneish M-Score models, while the hypotheses are tested using panel regression and moderation analysis. Result/Findings: The results show that greenwashing is significantly associated with fraudulent financial reporting, generally negatively across models. Political connections also significantly affect fraudulent financial statement, although the direction varies by measurement approach. Independent commissioners moderate the relationship between greenwashing and fraud, but their role in the political connections-fraud relationship is limited. Analysis comparing pre-crisis and COVID-19 periods shows that economic stress influences these relationships. Findings have practical implications for banking governance by emphasizing effective board oversight, stronger monitoring by independent commissioners, and improved transparency in sustainability and political-related disclosures to reducing fraud. Novelty/Originality/Value: The study contributes to the literature by Employing both F-Score and M-Score models and comparing pre-crisis and COVID-19 periods, the study shows that economic stress and ESG scrutiny alter governance effectiveness and incentives for fraudulent reporting in emerging-market banks.
