International Journal of Management, Accounting & Economics

Vol.2, No.1: 41-56, March 2016

Available online @ www.iaajs.com/ijmae
ISSN: 2412-0642

Social Enterprise Characteristics and Environmental Disclosures in

Annual Reports of Mining Companies of Indonesia

Amir Indrabudiman1*

1. Doctoral Student in Accounting Sciences at Padjadjaran University, Bandung, Indonesia and

Lecturer Faculty of Economics at Budi Luhur University, Jakarta, Indonesia.
* Email: amir.indrabudiman@gmail.com

Abstract This study examines the effect of the characteristics of the company (which includes
the company's profitability, age, earnings per share, size, public ownership, leverage, size of the
board) on social and environmental disclosure in the annual report. Multiple linear regression was
used for analysis of data on 40 mining companies listed on the Indonesia Stock Exchange in 2014.
This study showed that the characteristics of the company has a positive and significant impact on
the disclosure of social and environmental data (which consists of the theme of economic,
environmental, labor, rights human rights, society, product liability, and additional mining
indicators). Partial test results showed that the only variable Earnings Per Share (EPS), which has
a positive and significant impact on the company's social and environmental outcomes disclosure.
Test between sub-variables / dimensions indicate that EPS significantly influence the disclosure of
economic performance, environmental, product liability and additional indicators. Meanwhile,
debt had a significant effect on product disclosure, the public and additional indicators. Then, age
was significant towards the disclosure of additional indicators of mining. In addition to
significantly affect the size of the Board and the public disclosure of additional indicators of
mining. Then the size of the company's significant influence on product disclosure.

Keywords: Profitability, Age, Earnings Per Share, Size, Public Ownership, Leverage, Board Size,
Social and Environmental Disclosure, Indonesia

1. INTRODUCTION
Control of the pace of environmental destruction in Indonesia is low. Indonesia's
forests are expected to be the lungs of the world, which has long suffered deforestation and
degradation of the worst, sharp quality. If the environment is damaged, it is the little people
who directly feel the impact, said Ali Maskur Moses, who represented Indonesia at the
meeting of the Board of regulator / Ministerial Forum Global Environment (GC / GMEF)
UNEP United Nations Environment Programme in Nairobi, Kenya (Ali Maskur, 2014).
Social issues and the environment are problems facing Indonesia. This issue is closely
associated with industrial companies mostly producing waste. Companies are required to
exploit and process existing resources as much as possible so as to minimize the social
burden in the event of environmental damage caused by waste company, whereby the
company is obliged to be responsible for the impact. Another important issue is how far the
company can be responsible for the overall socio-economic problems and how appropriate
financial treatment to describe the inter-company transactions with the social environment
(Azhar and Azizul, 2003).
41
 Indrabudiman

Growing awareness of corporate social responsibility resulted in the criticism of the

use of profit as the sole means of measuring the company's performance, as well as pressure
from various parties, especially the stakeholders of the private sector, to assume
responsibility for the impact of the effect of business activity in the community. Business
entities are one of the economic actors have a major influence on the lives of the economy
and society at large, so that an enterprise is not only responsible to investors and creditors,
but also the wider community (Suwaldiman, 2000).
Global Reporting Initiative (GRI) has issued guidance / guidelines that can be used to
measure the practice sustainability management in the form of the GRI Sustainability
Reporting Guidelines by showing some important elements related to three aspects:
economic, environmental and human or triple bottom line (Profit, Planet & People).
Sustainability Reporting is reporting done by companies to measure, reveal (disclose)
information, helping the company's efforts to become a company that is accountable to all
stakeholders (stakeholders), for the purpose of performance of the company related to
sustainable development (Arief Effendi, 2012).
Ali Darwin, chairman of the National Center for Sustainability Report (NSCR) said of
the 438 companies currently listed in the Indonesia Stock Exchange (BEI), there are about 25
companies that make sustainability report (sustainability report). There are several factors
that according to Ali, that make companies reluctant to make sustainability report. First, the
company is not transparent in its business, and do not have a firm commitment to good
corporate governance (GCG). The second factor is the company considers sustainability
report as too hard of a change. Nevertheless, continued Ali, a sustainability report is a very
important role in attracting investors to come in and invest into a company. The trend today is
that investors not only see a performance report, but also see how the company maintains the
continuity of the business in the future, he has noted (Henderson, 2011).

2. DEFINITIONS, THEORETICAL FRAMEWORK, AND HYPOTHESIS.

2.1. Agency Theory.
The theory underlying this study is agency theory that studies the relationship
between the two parts of Principals and Agents, where Principal as owners, shareholders,
superiors or guarantor agents and agents as managers, department heads, subordinates, or
those guaranteed by the principal (Watts and Zimmerman , 1990).

2.2. Legitimacy Theory

Dowling and Pfeffer (1975) state that, "legitimacy is important for the organization,
the constraints imposed by the norms and social values, [because] the reaction to these limits
encourage the importance of the analysis of organizational behavior with attention to the
environment." Belkaoui (1998) states in this regard that, "... the organization should act to

42
 Indrabudiman

maximize social welfare, in the event of a contract between the organization and the
community. Thus, the legitimacy of the public organization.

2.3. Triple Bottom Line (TBL)

Slater et al. (2011) state that John Elkington attempted to measure the sustainability
during the mid-1990s with a new framework for measuring the performance of corporate
America. This accounting framework, the so-called Triple Bottom Line (TBL), exceed the
size of the traditional income, investment returns and shareholder value by incorporating
environmental and social dimensions. Focusing on comprehensive investment results in equal
respect to performance along the interrelated dimensions profit (Profit), the person (People)
and the environment (Planet). Triple bottom line reporting can be an important tool to support
sustainability goals.

2.4. Sustainability Report

Sustainability report are the practice of measurement, disclosure and accountability
efforts of the organization's performance in achieving the goals of sustainable development to
stakeholders both internal and external. 'Sustainability Report' is a general term that is
considered synonymous with other terms to describe a report on the impact of economic,
environmental, and social issues (eg, triple bottom line, corporate responsibility reporting,
etc.). A sustainability report should provide a balanced picture and sense of the sustainability
performance of an organization, both positive and negative contributions" (Global Reporting
Initiative, 2006).

2.5. Social and Environmental Disclosure.

Matthews (1997: 483) defines social and environmental disclosure as follows:
"Voluntary disclosures of information, both qualitative and quantitative disclosures, may be
in financial or non-financial terms." Disclosure of social and environment used in this
research is to use a list of disclosure of the 90 item indicators guidelines sustainability report
Global Reporting Initiative (GRI) third generation (G3), which consists of the theme of
economic performance, environmental performance, labor practices and decent work, human
rights, society, product liability, and additional indicators for the mining companies.
Measurement disclosure of social and environmental conducted using Content analysis, a
method that can perform in-depth discussion on the content of the information written or
printed in a media source, is a method of text analysis that is fairly reliable, and aims to
explain the variables of real symptoms so to understand a phenomenon (Mudjia Rahardjo,
2010). Content analysis has been used in previous research on measuring social responsibility
as by Sembiring (2005). An approach to measure the disclosure of social and environmental
responsibility using the weighted index (Garcia and Martinez, 2005: 308) with a score is
shown the following table:

43
 Indrabudiman

Table1: Description of the Environmental and Social Disclosure Score (Y)

No. Criteria Score Scale

1 not disclosed 0 Nominal

2 Expressed with narration 1 Nominal

3 Expressed with narration and figures / tables / charts 2 Nominal

Furthermore, scores of each item is summed to obtain the overall score for each
company. Disclosure index calculation formula of social responsibility (Corporate Social
Responsibility Disclosure Index - CSRD) is as follows:

Xij
CSRDj = ----------
nj

Description:
CSR: Corporate Social Responsibility Disclosure Index company j & j: the number of items
for firm j,
Xij: dummy variable, 0 = if the item i is not disclosed, 1 = if the item i expressed in narrative
only, 2 = if the item i is expressed with narration and figures / tables / graphs.

2.6. Profitability
According Husnan and Pudjiastuti (1998: 74), profitability ratios of profit margin on
sales (profit-margin-on-sales) which is calculated from the net profit after tax in relation to
sales. Profitability is the company's ability to generate profits in order to increase shareholder
value. Past performance as measured by the level of profitability will affect the level of
disclosure. For example, a more profitable firm would be happier to disclose information to
the public than companies that are not too favorable. The reason is the company likely to
reveal the good news to its owners and the lack of compensation for the management of its
good performance in managing the resources entrusted to him (Meek Roberts and Gray,
1995).
According to Gray, et al. (2001), profitability is a factor that makes the management
to be free and flexible to reveal social accountability data to shareholders, causing a higher
level of profitability of the company, which will result in the greater disclosure of social
information.
If companies have a high rate of profit, the company (management) hope that users of
financial statements would be read as "good news" the company's performance, for example

44
 Indrabudiman

in the social sphere, and thus investors will continue to invest in the company. The meaning
of "good news" here is a company making efforts to gain legitimacy from stakeholders and
stakeholders through social disclosure of information so as to give confidence to investors
that the company's survival is assured (sustainable). Thereby, it can be said that profitability
has a positive relationship to the level of social and environmental disclosure.

2.7. Age
According Poerwadarminta (2003: 1338) definition of old age is a time to live or exist
(since birth or held). Widiastuti (2002) states that: "Age [of a] company can show the
existence and the competitive ability of the company".
Age of a company is the length of life of the company. This indicates the existence of
the company in competition. Companies that live longer have more experience in publishing
annual reports. Companies that have a lot more experience will be more aware of the needs of
information desired by stakeholders. When linked with social disclosure, companies that live
longer tend to express more corporate social responsibility information. Marwata (2001)
suggested that the age of the company is expected to have a positive relationship with the
quality of voluntary disclosure. Thereby, it can be said that the life of the company has a
positive relationship with the level of disclosure of corporate social responsibility.

2.8. Earning Per Share (EPS)

Earnings per share (EPS) is the amount of profit that the rights to each shareholder of
the common shares. Earnings per share is calculated only for ordinary shares, depending on
the company's capital structure (Dwi Prastowo and Juliaty, 2002: 93). Belkoui and Karpik
(1989) state that the management that is aware of and pays attention to social issues will also
propose the necessary capabilities to drive financial performance. Consequently, companies
that have a social response in relation to social responsibility disclosure should fire someone
who does not provide this strong level of return on investment. Besides, major stakeholders
will pressure companies to disclose more information than that of the stakeholders. So it can
be said that the EPS has a positive relationship to the level of disclosure of corporate social
responsibility.

2.9. Size
Definition of the size of the company according to RJ (2008: 313) is as follows: it is
"[t]he size of the company seen from the value of equity, sales value or the value of assets."
In this research company size was measured by using a natural log total assets. Larger
companies have more stakeholders are more likely to have a public demand / pressure of
information is higher than with a smaller company, so that in general, large companies
disclose more information than small companies.

45
 Indrabudiman

Thereby, it can be said that company size (Size) has a positive relationship to the level
of disclosure of corporate social responsibility.

2.10. Public Ownerships

Public ownership is the proportion of ownership of shares held by the public /
community to shares of the entire firm. The public are individuals or institutions that have a
stake below 5% which are outside of management and have no special relationship with the
company (Princess, 2011). Public ownership means that the people involved have a stake
company. A company whose shares are mostly held by the public has a lot more
stakeholders. More stakeholders will pressure companies to disclose more information than
companies whose shares are not held by the public. Thereby, it can be said that public
ownership has a positive relationship to the level of disclosure of corporate social
responsibility.

2.11. Leverage
Leverage is a tool to measure how much of the company depends on the lender to
finance the company's assets. Leverage reflects the level of financial risk the company
(Sembiring, 2005). Leverage used in this study are consistent with measures used Kokubu et.
al., (2003) which is the ratio of debt to equity (debt to equity ratio)
Companies with high leverage, to bear the cost of monitoring (monitoring cost) also
have a large pressure from creditors who want the disclosure of more information pertaining
to the assessment eligibility status of creditors. The firm with higher leverage will provide
more comprehensive information and companies with a ratio, liabilities to high capital, will
reveal more information in their annual reports than companies with low ratios. Thereby, it
can be said that leverage in this case has a positive relationship to the level of disclosure of
corporate social responsibility.

2.12. Board of Commissioners.

The Board of Commissioners (BOC) is a board that is in charge of supervising and
advising the director of a limited liability company (PT) (Coller and Gregory, 1999). The
presence of commissioners will reduce agency problems that occur between shareholders and
management. The Board of Commissioners supervises the performance of management.
Control and monitoring of the CEO will be more easy and effective when the power and
number of commissioners rise. Associated with social responsibility disclosure, then the
pressure on management will also be great to express it. Thereby, it can be said that the board
size has a positive relationship to the level of disclosure of corporate social responsibility.

46
 Indrabudiman

2.13. Hypothesis
In accordance with the framework outlined in the previous point, the research
hypothesis can be formulated as follows (stated in alternative form):
Ha : The companies characteristic (which includes the corporate profitability, age, earnings
per share, size, public ownership, Leverage, board size) have a positive and
significant influence on social and environmental disclosure (which consists of the
theme of economic, environmental, labor, human rights, society, product liability, and
additional indicators of mining) both simultaneous and partially.

3. RESEARCH METHOD
3.1. Research Design
The research design used in this study are as follows:

Table 2: Reheard Design

No. Research Design Elements Specification

1. Purpose of the study Descriptive verification
2. Types of investigation Causal
3. Approach Quantitative
4. Method Explanatory research
5. Unit of analysis Organization
6. Sampling design Census
7. Time horizon Cross-Sectional study
8. Data collection method Secondary
9. Scales & Measurement Ratio scale
Source: Sekaran and Bougie (2010)

3.2. Samples
Sampling was done by census. The number of samples is equal to the number in the
population, in this case, the entire mining companies listed on the Indonesia Stock Exchange
in 2014, totaling 40 companies.

47
 Indrabudiman

3.3. Research Model

The research model was formed by the merger of existing models in the literature
before, to test the hypothesis (the influence of the characteristics of companies on the
disclosure of social and environmental), then use the model:

CSRDi = 0 + 1NPM + 2AGE + 3EPS +4 SIZE + 5 PO + 6 DER + 7 BoC + 1

Keterangan:
CSRD = Social and Environmental Disclosure
NPM = Company Profitability
AGE = Company Age
EPS = Earning Per Share
SIZE = Company Size
PO = Public Ownership
DER = Debt Equity Ratio
BoC = Board of Commissioner
i = Jumlah perusahaan sample (1,2,3,4,...)
0 = Intercept
1...n = Coefficient slope

3.4. Collection Data Method

The data collection method used is the method of documentaries, because the data
collected is of a secondary data, which was obtained by searching the website of the
Indonesia Stock Exchange (BEI) and the websites of related companies that were sampled.

3.5. Technique Data Analysis

Statistical analysis techniques used in this research is multiple linear regression with
the aim to find the relationship between the dependent variable and one or more independent
variables.

48
 Indrabudiman

4. RESULTS RESEARCH
4.1. Simultaneous Test Hypothesis
Testing the hypothesis in the research is done by using multiple linear regression.
Based on this regression analysis further resulting in a value of derivatives, among others, the
correlation coefficient (R), the coefficient of determination (adjusted R2), and Statistics F test
and t test statistics, with a significance level of 0.05 were used. The result of the correlation
coefficient (R) and the coefficient of determination (adjusted R2) can be seen in Table 3 as
follows:

Table 3: Test Results Correlation Coefficient and Coefficient of Determination

Adjusted. Std. Error of the

Tahun R R. Square R.Square Estimate

2013 0,639a 0,408 0,270 0,2140281

Source: proceed by author

Based on data in Table 3, we see the R value result is 0,639, the correlation between
the independent variables (profitability, age, earnings per share, size, public ownership,
leverage, board size) with the dependent variable, the social and environmental disclosure in
annual reports. It is a fairly strong relationship. The Adjusted R2 is 0,270, which means that
the independent variables (profitability, age, earnings per share, size, public ownership,
leverage, board size) is able to explain the variations on the social and environmental
disclosure in annual reports 27%, while the rest (73%) is explained by other factors. Statistics
of the F test results can be seen in Table 4 below.

Table 4: Result test F

Sum of Mean
Model Squares df Square F Sig.
1 Regression 0,947 7 0,135 2,954 0.018b
Residual 1,374 30 0,046
Total 2,322 37

Source: proceed by author

From the F test results obtained PH value of 2.954 with a significance level of 0.018,
meaning that the independent variables (profitability, age, earnings per share, size, public
ownership, leverage, board size) together have a positive and significant effect on on the
social and environmental disclosure in annual reports. This can be seen from the significant
value (0018) which is still below the 0.05 level.

49
 Indrabudiman

4.2. Partial Test Hypothesis

4.2.1. Companies characteristic on economic performance (ECi).
Table 5: The Influence of Companies Characteristics on Economic Performance

Critical
Influence (from to) R 2
Ratio Result
(C.R.) p-value
AGE ECi -0,060 -0,393 0,695 Not significant
EPS ECi 0,300 1,975 0,048 Significant
DER ECi -0,069 -0,456 0,648 Not significant
NPM ECi 0,015 0,097 0,923 Not significant
BoC ECi 0,048 0,316 0,752 Not significant
PO ECi 0,152 1,001 0,317 Not significant
SIZE ECi 0,155 1,02 0,308 Not significant
Source: proceed by author

Table 5 shows that the biggest factor characteristics of a company that has positive
influence on economic performance disclosure is EPS (30%), SIZE (15.5%), and Public
Ownership (15.2%). The company characteristic factors that negatively affect economic
performance are the disclosure of Debt Equity Ratio (-6.9%) and AGE (-6%). That is, the
larger the EPS, the size of the company and public ownership, the greater the company also
revealed its economic performance in its annual report.

4.2.2. Companies characteristic on environmental performance (ENi).

Table 6: The Influence of Companies Characteristics on Economic Performance
Critical
Influence (from to) R 2
Ratio Result
(C.R.) p-value
EPS ENi 0,421 2,971 0,003 Significant
DER ENi 0,111 -0,781 0,435 Not significant
NPM ENi 0,016 0,111 0,911 Not significant
PO ENi 0,073 0,513 0,608 Not significant
AGE ENi 0,074 0,522 0,602 Not significant
BoC ENi 0,135 0,951 0,341 Not significant
SIZE ENi 0,155 1,38 0,168 Not significant

Source: proceed by author

Table 6 shows that the biggest factor characteristics of companies that have positive
influence on the disclosure of environmental performance is EPS (42.1%), SIZE (19.6%) and
the size of the BOC (13.5%). Meanwhile, the characteristics of the factors that negatively
affect the company's disclosure is the DER (-11.1%). That is, the larger the EPS, SIZE and

50
 Indrabudiman

the size of the Board of Commissioners, the greater the company also revealed its
Environmental Performance in its annual report.

4.2.3. Companies characteristic on environmental disclosure (LAi).

Table 7: The Influence of Companies Characteristics on Economic Performance
Critical
Influence (from to) R 2
Ratio Result
(C.R.) p-value
DER LAi -0,127 -0,833 0,405 Not significant
AGE LAi -0,118 -0,778 0,437 Not significant
SIZE LAi -0,052 -0,343 0,732 Not significant
EPS LAi 0,018 0,116 0,908 Not significant
BoC LAi 0,182 1,197 0,231 Not significant
NPM LAi 0,196 1,286 0,198 Not significant
PO LAi 0,200 1,312 0,19 Not significant
Source: proceed by author
Table 7 shows that the biggest factor characteristics of companies that have positive
influence on the disclosure of Labor Practices and Decent Work is Public Ownership (20%,
Net Profit Margin (19.6%), and the size of the BOC (18,2%). The factor characteristics that
negatively affect the company's disclosure is the DER (18.2%), AGE (-11.8%), and SIZE (-
5.2%). That is, the greater the Public Ownership, Net Profit Margin, and BOC, the greater the
company also reveals labor practices and decent work in its annual report.

4.2.4. Companies characteristic on human rights performance (HRi).

Table 8: The Influence of Companies Characteristics on Economic Performance

Critical
Influence (from to) R2 Ratio Result
(C.R.) p-value
DER HRi -0,071 -0,459 0,646 Not significant
NPM HRi -0,022 -0,145 0,885 Not significant
PO HRi 0,054 0,348 0,728 Not significant
AGE HRi 0,055 0,356 0,722 Not significant
BoC HRi 0,078 0,507 0,612 Not significant
SIZE HRi 0,174 1,131 0,258 Not significant
EPS HRi 0,276 1,793 0,073 Not significant

Source: proceed by author

Table 8 shows that the biggest factor characteristics of companies that have positive
influence on the disclosure of Human Rights is EPS (27.6%), and SIZE (17.4%). While the
characteristics of the factors that negatively affect the company's disclosure is the DER (-

51
 Indrabudiman

7.1%) and Net Profit Margin (-2.2%). That is, the larger the EPS and SIZE, the greater the
company also revealed aspects of Human Rights in its annual report.

4.2.5. Companies characteristic on community performance (SOi).

Table 9: The Influence of Companies Characteristics on Economic Performance
Critical
Influence (from to) R2
Ratio Result
(C.R.) p-value
DER SOi -0,333 -2,39 0,017 Significant
BoC SOi 0,305 2,195 0,028 Significant
NPM SOi 0,039 0,283 0,777 Not significant
AGE SOi 0,058 0,414 0,679 Not significant
SIZE SOi 0,076 0,543 0,587 Not significant
PO SOi 0,099 0,712 0,477 Not significant
EPS SOi 0,243 1,743 0,081 Not significant

Source: proceed by author

Table 9 shows that the biggest factor characteristics of a company that has positive
influence on the community aspect of the disclosure in the annual report is the size of the
BOC (30.5%), EPS (24.3%), and Public Ownership (9.9%). The company characteristic
factors that negatively affect the disclosure is Debt Equity Ratio / DER (-33.3%). That is, the
larger the size of the Board of Commissioners, EPS, and public ownership, the greater the
company also revealed aspects of society in its annual report.

4.2.6. Companies characteristic on disclosure of product responsibility (PRi).

Table 10: The Influence of Companies Characteristics on Economic Performance
Critical
Influence (from to) R2 Ratio Result
(C.R.) p-value
DER PRi -0,502 -4,027 *** Significant
EPS PRi -0,256 -2,055 0,04 Significant
SIZE PRi 0,282 2,26 0,024 Significant
AGE PRi -0,40 -0,323 0,747 Not significant
PO PRi 0,001 0,006 0,995 Not significant
NPM PRi 0,022 0,173 0,863 Not significant
BoC PRi 0,159 1,273 0,203 Not significant

Source: proceed by author

Table 10 shows that the biggest factor characteristics of companies that have positive
influence on the disclosure of Product Responsibility is SIZE (28.2%), and the size of the
BOC (15,9%). But, the characteristics of the factors that negatively affect the company's

52
 Indrabudiman

disclosure is the DER (-50.2%), EPS (-25.6%) and AGE (-4%). That is, the greater the SIZE,
Size BOC, the greater the company also revealed the Product Responsibility in its annual
report.

4.2.7. Companies characteristic on additional mining disclosure (MMi).

Table 11: The Influence of Companies Characteristics on Economic Performance
Critical
Influence (from to) R 2
Ratio Result
(C.R.) p-value
DER MMi -0,422 -4,032 *** Significant
AGE MMi -0,267 -2,553 0,011 Significant
BoC MMi 0,215 2,053 0,04 Significant
EPS MMi 0,541 5,168 *** Significant
SIZE MMi 0,032 0,303 0,762 Not significant
NPM MMi 0,045 0,425 0,671 Not significant
PO MMi 0,063 0,599 0,549 Not significant
Source: proceed by author
Table 11 shows that the biggest factor characteristics of companies that have positive
influence on the disclosure of additional indicators for mining is EPS (54.1%) and the size of
the BOC (21.5%). Meanwhile, the characteristics of the factors that negatively affect the
company's disclosure is the DER (-42.2%) and AGE (-26.7%). That is, the larger the EPS and
size of the Board of Commissioners, the greater the company also revealed additional
indicators for mining in the annual report.

4.2.8. Characteristics Influencing Against Corporate Social and Environmental Disclosure.

Results of this study are consistent with several earlier empirical studies about the
effects of corporate characteristics on the disclosure of social and environmental, among
others: (1) EPS, Belkoui and Karpik (1991), that management are aware of and pay attention
to social problems will also propose the necessary capabilities to drive performance finance
companies; (2) The leverage ratio of a company (Ainun Na'im and Fuad Rakhman, 2000).
Marwata (2001) states that the higher the leverage ratio will provide more information to
meet the needs of long-term creditors; (3) age, results of this study are consistent with
research Gray et al., (2001) and Yuningsih (2006) which states that the life of the company
significantly affect the disclosure of social responsibility, as well as Marwata (2003) which
suggests that its age is estimated have a positive relationship with the quality of voluntary
disclosure. The underlying reason is that an aged company has more experience in publishing
financial statements. Companies that have a lot more experience will be more aware of the
need for information for the company's constitution; (4) The size of the BOC, the results of
this study are consistent with research Coller and Gregory (1999) in Sembiring (2004) and
Arifin (2004) which state that the board size significantly affect the social responsibility

53
 Indrabudiman

disclosure; (5) Firm size (Size), writes Fitriani (2001) that the size of companies influence
social and environmental disclosure. Cooke (1989) states the greater the size of a company,
the higher its disclosure.

5. CONCLUSIONS AND RECOMMENDATIONS.

5.1. Conclusions
Based on the discussion of the previous section, we can conclude that the results of
simultaneous testing showed that the characteristics of the company (which includes the
dimensions of a company's profitability, the age of the company, earnings per share, the size
of the company, public ownership, the level of corporate debt, board size) together have a
positive and significant effect on the company's social and environmental disclosure. Partial
test results showed that the only variable Earnings Per Share (EPS), which has a positive and
significant influence on Corporate Social Responsibility, while the other dimensions do not
have a significant influence on the company's social and environmental disclosure. The test
results between sub-variable / dimensions indicate that EPS significantly influence the
disclosure of economic performance, environmental, and other indicators such as product
responsibility. While DER significant effect on product disclosure, community and indicator
tambahan. Company AGE has a significant effect on the disclosure of additional indicators
regarding mining. Company Size and BOC power significantly affect public disclosure and
additional indicators such as mining. Thus, the size of the company significantly influences
product disclosure.

5.2. Recommendations
For future research, the following suggestions are offered:
1. At least, for the sample and the period of this study, this research allows one to describe
the conditions thoroughly to make generalizations. But, expect future studies to collect more
samples (not just the mining company) over a longer period of the year.
2. Regarding the variables (dimensions) research, they should investigate additional variables
(factors) that have not been presented here. This is because the value of the coefficient of
determination (adjusted R2) research is only (27%), which means that most of the company's
social and environmental disclosure (73%) are influenced by variables (factors) other than the
variables studied.
3. Conduct further research on the social and environmental disclosure by the sample
companies other than those listed on the Stock Exchange, as of the reporting sustainability
report, not only the companies that have gone public, but to include numerous companies in
the Oil and Gas industry that may not have gone public yet.
4. Encourage the Indonesian Accountants Association (IAI) to make a disclosure of social
and environmental standards that are decisive for the company, ensuring for the uniformity of
reporting in it annual report.

54
 Indrabudiman

REFERENCES
Ali Maskur Musa. (2014). Kontrol Kerusakan Lingkungan Lemah. Artikel Lingkungan
Global. Koran Kompas, 23 Februari 2014. Kompas. Jakarta.
Arief, Effendi (2012). http://muhariefeffendi.wordpress.com/2012/05/30/pelaporan-
berkelanjutan-sustainability-reporting-sebagai-implementasi-gcg/
Azhar Maksum dan Azizul Kholis. (2003). Analisis Tentang Pentingnya Tanggung Jawab
dan Akuntansi Sosial Perusahaan (Corporate Responsibility and Social Accounting):
Studi Empiris di Kota Medan. SNA VI, Surabaya, 16-17 Oktober 2003.pp 168-190.
Belkaoui, Ahmed. (1998). Accounting Theory; Terjemahan oleh Budhi Pudjiharto: AK
Group, Yogyakarta.
Belkaoui, Ahmed, Karpik G. Philip. (1989). determinants of The Corporate Decision to
Disclosure Social Information, Auditing, & Accountability Journal Vol.2 No.1 p.36-
51.
Coller, P., and A. Gregory. (1999). Audit Committee Activity and Agency Costs, Journal
of Accounting and Public Policy, Vol 18 (4-5) pp 311-332.
Dowling, J. and Pfeffer, J. (1975). Organizational legitimacy: social values and
organizational behaviour, Pacific Sociological Review, Vol.18, No.1, pp. 122-136.
Dwi Prastowo dan Rifka Juliaty. (2002). Analisis Laporan Keuangan, Cetakan Kedua,
Penerbit AMP YKPN, Yogjakarta.
Global Reporting Initiative. (2006). G3 Reporting Guidelines. Amsterdam. Belanda.
Gray, R., Javad, M., Power, David M., and Sinclair C. Donald. (2001). Social And
Environmental Disclosure, And Corporate Characteristic: A Research Note And
Extension., Journal of Business Finance and Accounting, Vol 28 No. 3, pp 327-356.
Hendra.(2011).http://investasi.kontan.co.id/news/dari-438-emiten-hanya-25-perusahaan-
yang-membuat-laporan-berkelanjutan.
Kokubu et al. (2003). Determinants of Narrative Content of Sustainability Reporting by
Japanese Companies.
Mathews, M.R. (1997). Twenty-five years of social and environmental accounting research:
Is there a Silver Jubilee to celebrate? Accounting Auditing and Accountability
Journal, Vol. 10, No. 4, pp.481-531.
Marwata, (2001). Hubungan Antara Karakteristik Perusahaan dan Kualitas Ungkapan
Sukarela dalam Laporan Tahunan Perusahaan Publik di Indonesia. Makalah
dipresentasikan dalam Simposium Nasional Akuntansi IV, 2001.
Meek, GK, Robert CB, Gray SJ. (1995). Factors Influencing Voluntary Annual Report
Disclosures by US, UK, and Continental European Multinational Corporations.
Journal of International Business Studies.Vol. 26. No. 3.p.555-572.
Poerwadarminta, W. J. S. (2003).Kamus Umum Bahasa Indonesia.Jakarta. Balai Pustaka.

55
 Indrabudiman

Putri, Diah Safitri. 2011. Faktor- faktor yang Mempengaruhi Luas Pengungkapan Sukarela
Laporan Tahunan Perusahaan.: Fakultas Ekonomi dan Bisnis Universitas.
MalangBrawijaya
Riyanto, Bambang. (2008). Dasar-Dasar Pembelanjaan Negara.Yogyakarta: BPFE.
Slaper, Timothy F and Hall, Tanya J. 2011, The Triple Bottom Line: What is it and how does
it work, Indiana Business Review, Spring 2011.
Suad Husnan, Enny Pudjiastuti. (1998). Dasar-Dasar Manajemen Keuangan, Edisi Kedua,
Penerbit: Akademi Manajemen Perusahaan YKPN, Yogyakarta.
Widiastuti, Harjanti. (2002). Pengaruh Luas Ungkapan Sukarela dalam Laporan Tahunan
terhadap Earning Response Coefficient (ERC), Simposium Nasional Akuntansi V,
Semarang 5-6 2002.

56