Corporate Governance: Driving Climate Change Disclosure and Advancing SDGs
Abstract
1. Introduction
- Does corporate governance have an effect on climate change disclosure and progress toward the SDGs?
- Does corporate governance moderate the effect of carbon disclosure on environmental performance and SDG progress?
2. Literature Review and Hypotheses Development
2.1. Literature Review
2.2. Hypotheses Development
2.2.1. Board Size
2.2.2. Board Independence
2.2.3. Board Gender Diversity
2.2.4. Foreign Ownership
2.2.5. CSR Committee
2.2.6. Corporate Governance
3. Methodological Approach
3.1. Sample Selection
3.2. Research Model
3.3. Measurement of Variables
3.3.1. Dependent Variable
3.3.2. Independent Variable
3.3.3. Control Variables
4. Results and Discussion
4.1. Descriptive Statistical Analysis
4.2. Multiple Regression Analysis Results
4.3. Discussion
4.3.1. Board Size Analysis
4.3.2. Board Independence Analysis
4.3.3. Board Gender Diversity
4.3.4. Foreign Ownership Analysis
4.3.5. CSR Committee
4.3.6. Corporate Governance
5. Recommendations for Future Studies
6. Conclusions
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Conflicts of Interest
References
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No | Criteria | Total |
---|---|---|
1 | Non-financial firms registered on the Indonesia Stock Exchange for the period 2016–2022 | 235 |
2 | Non-financial firms multiplied by 7 years of the research period | 1645 |
3 | Firms that do not release annual reports and sustainability reports | (1020) |
4 | Number of firms—years that release annual reports and sustainability reports | 625 |
5 | Companies—years that do not provide complete data on carbon emissions | (157) |
6 | Companies—years for which complete data on carbon emissions (sample unbalance) | 468 |
Variable | Measurements | Reference |
---|---|---|
Carbon emission disclosure (CED) | The analytical approach to the content disclosed in a company’s sustainability report and assessed on a scale of 0–5, the formula is as follows: | (Bae Choi et al., 2013; I. F. S. Wahyuningrum et al., 2022b) |
Carbon performance (CP) | Carbon intensity ratio is obtained by calculating the amount of GHG emissions from scope 1 and 2 divided by the company’s total revenue. | (Bui et al., 2020) |
Board size (BSIZE) | Number of directors in the board. | (I. Wahyuningrum et al., 2020) |
Board independece (BIND) | The proportion of independent commissioners relative to the total board. | (Mateo-Márquez et al., 2022) |
Board gender diversity (GENDER) | The ratio of women to total board members. | (Miller & del Carmen Triana, 2009; I. F. S. Wahyuningrum et al., 2022b) |
Foreign ownership (FOWN) | Shares of a company owned by foreign parties divided by shares outstanding. | (Kim et al., 2021) |
The presence of the CSR committee (CSR_COM) | CSR committee presence is scored as 1 if present, 0 if absent (dummy variable). | (Mateo-Márquez et al., 2022) |
Profitability (ROA) | Return to asset ratio: | (Uyar et al., 2021) |
Leverage (DER) | Debt to equity ratio: | (Lu & Abeysekera, 2014) |
Firm size (SIZE) | Total company assets. | (Elsayih et al., 2021) |
N | Min | Max | Mean | Std. Dev | |
---|---|---|---|---|---|
CED | 468 | 0.01 | 0.60 | 0.2780 | 0.11274 |
CP | 468 | 0.00 | 0.95 | 0.0663 | 0.17602 |
BSIZE | 468 | 2.00 | 15.00 | 5.6517 | 2.10446 |
BIND | 468 | 0.00 | 1.00 | 0.4213 | 0.12828 |
GENDER | 468 | 0.00 | 0.63 | 0.1181 | 0.12958 |
FOWN | 468 | 0.00 | 1.00 | 0.3068 | 0.30845 |
CSRCOM | 468 | 0.00 | 9.00 | 0.1709 | 0.79657 |
ROA | 468 | −0.87 | 25.52 | 0.1452 | 1.23518 |
DER | 468 | −4.17 | 90.52 | 1.8196 | 5.25789 |
SIZE | 468 | 24.85 | 36.92 | 31.4026 | 2.42391 |
Variable | CED | CP | ||
---|---|---|---|---|
Coefficient | t | Coefficient | Coefficient | |
Intercept | 0.0241153 | 3.35 | 0.3783405 | 3.51 |
BSIZE | 0.0117046 | 4.58 *** | 0.0149649 | 3.75 *** |
BIND | −0.0089438 | −1.22 * | −0.063113 | −1.316 * |
GENDER | 0.009022 | 1.12 * | 0.1189904 | 1.86 * |
FOWN | 0.0021 | 1.38 * | 0.0901937 | 3.38 *** |
CSRCOM | 0.0084059 | 1.86 ** | 0.0184932 | 1.86 * |
ROA | 0.0019209 | 0.47 | 0.0017666 | 0.28 |
DER | −0.0004015 | −0.42 | 0.0008972 | 0.60 |
SIZE | 0.0060985 | 2.76 *** | −0.0123612 | 3.58 *** |
Number of Obs | 468 | 468 | ||
Adj R2/Pseudo R2 | 0.0719 | 0.0747 | ||
Prob > chi2 | 0.0000 | 0.0000 | ||
Breusch–Pagan test | 1.000 | 1.000 | ||
Mean VIF | 1.01 | 1.09 | ||
Hausman (Prob.) | 0.8076 | 0.7096 |
Variable | Carbon Performance (CP) | CP (Moderated by Corporate Governance (CG)) | ||
---|---|---|---|---|
Coefficient | t | Coefficient | t | |
Intercept | 0.3706356 | 4.48 *** | 0.3862809 | 5.41 |
CED | 0.0241153 | 3.75 *** | ||
CED*BSIZE | 0.0602554 | 1.315 * | ||
CED*BIND | 0.1161078 | −1.87 * | ||
CED*GENDER | 0.0895227 | 3.38 *** | ||
CED*FOWN | 0.0158074 | 1.86 * | ||
CED*CSRCOM | 0.0011529 | 1.62 * | ||
BSIZE | 0.0149649 | 2.81 *** | ||
BIND | 0.1163113 | 0.98 | ||
GENDER | 0.1189904 | −1.86 * | ||
FOWN | 0.0901937 | 3.43 *** | ||
CSRCOM | 0.0184932 | 1.62 * | ||
ROA | 0.0027538 | 0.43 | 0.0017666 | 0.18 |
DER | 0.0010026 | 0.67 | 0.0008972 | 0.70 |
SIZE | 0.0100531 | 3.02 *** | 0.0143097 | 4.20 *** |
Number of Obs | 468 | |||
Adj R2/Pseudo R2 | 0.11116 | |||
Prob > chi2 | 0.0000 | |||
Breusch–Pagan test | 1.000 | |||
Mean VIF | 1.08 | |||
Hausman (Prob.) | 1.000 |
Hypothesis | Statement | Result |
---|---|---|
H1a | Board size has a positive and significant effect on carbon emission disclosure. | Supported |
H1b | Board size has a positive and significant effect on carbon performance. | Supported |
H2a | Board independence has a positive and significant effect on carbon emission disclosure. | Not supported (negative) |
H2b | Board independence has a positive and significant effect on carbon performance. | Not supported (negative) |
H3a | Gender diversity has a positive and significant effect on carbon emission disclosure. | Supported |
H3b | Gender diversity has a positive and significant effect on carbon performance. | Supported |
H4a | Foreign ownership has a positive and significant effect on carbon emission disclosure. | Supported |
H4b | Foreign ownership has a positive and significant effect on carbon performance. | Supported |
H5a | CSR committee has a positive and significant effect on carbon emission disclosure. | Supported |
H5b | CSR committee has a positive and significant effect on carbon performance. | Supported |
H6 | Board size strengthens the effect of carbon emission disclosure on carbon performance. | Supported |
H7 | Board independence strengthens the effect of carbon emission disclosure on carbon performance. | Not supported (negative) |
H8 | Gender diversity strengthens the effect of carbon emission disclosure on carbon performance. | Supported |
H9 | Foreign ownership strengthens the effect of carbon emission disclosure on carbon performance. | Supported |
H10 | CSR committee strengthens the effect of carbon emission disclosure on carbon performance. | Supported |
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Wahyuningrum, I.F.S.; Baroroh, N.; Yanto, H.; Hidayah, R.; Puspita, A.S.; Elviana, L.D. Corporate Governance: Driving Climate Change Disclosure and Advancing SDGs. J. Risk Financial Manag. 2025, 18, 234. https://doi.org/10.3390/jrfm18050234
Wahyuningrum IFS, Baroroh N, Yanto H, Hidayah R, Puspita AS, Elviana LD. Corporate Governance: Driving Climate Change Disclosure and Advancing SDGs. Journal of Risk and Financial Management. 2025; 18(5):234. https://doi.org/10.3390/jrfm18050234
Chicago/Turabian StyleWahyuningrum, Indah Fajarini Sri, Niswah Baroroh, Heri Yanto, Retnoningrum Hidayah, Annisa Sila Puspita, and Laela Dwi Elviana. 2025. "Corporate Governance: Driving Climate Change Disclosure and Advancing SDGs" Journal of Risk and Financial Management 18, no. 5: 234. https://doi.org/10.3390/jrfm18050234
APA StyleWahyuningrum, I. F. S., Baroroh, N., Yanto, H., Hidayah, R., Puspita, A. S., & Elviana, L. D. (2025). Corporate Governance: Driving Climate Change Disclosure and Advancing SDGs. Journal of Risk and Financial Management, 18(5), 234. https://doi.org/10.3390/jrfm18050234