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Vol. 03, No. 01, January 2023

e-ISSN: 2807-8691 | p-ISSN: 2807-839X

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The Influence of Primary Stakeholder, Secondary

Stakeholder, and Regulatory Stakeholder on Carbon

Emission Disclosure

Fina Dwi Nuriyani, R. Rosiyana Dewi*

Faculty of Economics and Business, Universitas Trisakti, Jakarta, Indonesia

Email: fina02300[email protected], [email protected]*

Keywords

ABSTRACT

Carbon Emissions Disclosure; Internal

Primary Stakeholders; External Primary

Stakeholders; Secondary Stakeholders;

Regulatory Stakeholders

This research aims to analyze direct and indirect influences

between internal primary stakeholders, external primary

stakeholders, secondary stakeholders, and regulatory

stakeholders on carbon emissions disclosure. The population of

this research are non-financial companies listed on the Indonesia

Stock Exchange (IDX) in 2019-2021 period. The sample in this

research was 196 samples with a purposive sampling method. The

type of data in this study is secondary data, and panel data

regression analysis with the EViews 10. The results of this

research showed that investor-oriented industry, industry close to

consumers, media exposure, and government pressure have a

positive effect on carbon emission disclosure. Meanwhile

employee-oriented industries and creditor pressure have a

negative effect on carbon emission disclosure. Environmentally

sensitive industries and the audit by KAP Big 4 had no influence

on carbon emissions disclosure.

INTRODUCTION

Environmental problems are getting more serious, such as rising sea levels and thick smog, making

environmental awareness in society even more urgent. These problems are caused by climate change and the

energy crisis, which are the main factors in global environmental threats and sustainable development for living

things. Over time, climate change on earth has become a big concern, and now countries around the world are

competing to take concrete steps to reduce or stop the increase in carbon emissions. Forest fires occured in 2019,

spanning Central Kalimantan, East Kalimantan, and Riau, are an example of suspected environmental damage

caused by the business activities of several corporations (Kompas.com, 2019). Indonesia is a member of the G20

countries, which continue to commit to reducing carbon emissions by 26% in 2020 and 29% in 2030. Even though

Indonesia has made efforts to reduce carbon emissions, it is still quite behind other large economic countries that

are members of the G20. Currently, Indonesia is trying to accelerate the net zero emission project by building the

Indonesia Green Industrial Park, covering an area of 12,500 hectares in North Kalimantan. Another effort is to

rehabilitate 620,000 hectares of mangroves by 2024, which will have a carbon absorption capacity up to four times

greater than tropical forests (GoodnewsforIndonesia, 2022). Based on the results of the report (Climate Change

Performance Index (CCPI), 2022), Indonesia shows high performance in the renewable energy category, ranks

middle in the category of energy use and climate policy, and obtains low greenhouse gas (GHG) emissions. This

shows that Indonesia has an overall average performance. The Ministry of Industry (Kemenperin) continues to

implement a green industry in Indonesia by holding various activities to engage industry players and other

stakeholders, as well as academics, in collaborating together to create a domestic industry that is low in carbon

emissions and environmentally friendly. Disclosure of information about carbon accounting is an important part

of management accounting activities around the world. This reflects the company's behavior, effectiveness, and

responsibility in terms of the economy, environment, and society.

PT Nirmala Tipar Sesama was found to have committed environmental pollution by violating the use of B3

waste without a permit, storing it in an unauthorized area, and disposing of the waste without proper

authorization. (Metro.tempo.co, 2021). Similarly, in 2022, PT Kimu Sukses Abadi (KSA) in Cikarang was involved

in six environmental pollution violations, which led to its sealing (bekasikab.go.id 2022). There were two cases of

environmental pollution violations committed by PT Medco and PT Kimu. Such violations can be attributed to both

International Journal of Social Service and Research,

Fina Dwi Nuriyani, R. Rosiyana Dewi

IJSSR Page 195

internal and external factors. The driving category from within the company is the role of management and

company owners to care for and be responsible for the social and environmental aspects of the company. External

driving categories include regulations, laws, and mandatory environmental impact analysis. The government

through KLH has implemented a PROPER audit (Company Performance Improvement Assessment Program). The

issue of environmental pollution at this time proves the lack of special attention from management and its

stakeholders including the government regarding environmental views of business activities.

Based on the phenomenon above, researchers are interested in conducting research on the influence of

stakeholders on disclosing carbon emissions disclosure in Indonesia. The aim is to encourage the government to

prioritize environmental pollution issues and enact stricter policies. Additionally, this research seeks to foster

greater compliance with regulations and environmental responsibilities among industrial players. Investors,

consumers, the public, and other parties can also obtain information about the environment for their operational

activities. Stakeholders are divided into four groups, among others internal primary stakeholder, external primary

stakeholder, secondary stakeholder, and regulatory stakeholder. The four stakeholder groups include internal

primary stakeholders (investor-oriented industries & employee-oriented industries), external primary

stakeholders (industries close to consumer, environmentally sensitive industries & creditor pressure), secondary

stakeholders (media exposure & audits by KAP Big 4) and regulatory stakeholders. (government pressure) in

research (Sriningsih & Wahyuningrum, 2022). This study examines which stakeholders have an impact on

disclosure of carbon emissions, particularly within the category of internal primary stakeholders. Internal primary

stakeholders are shareholders and employees who have an important impact on information disclosure decisions.

A larger proportion of shares traded means that public shareholders have more voting rights, which creates

pressure on companies and encourages disclosure of carbon information (Tang et al., 2019). (Tang et al., 2019)

Investor pressure has a positive effect on carbon information disclosure. However, Chithambo et al., (2020)

revealed that investor pressure has no effect on voluntary disclosure of carbon emissions. Employee involvement

has a positive effect on disclosure of carbon emissions because it is more transparent and according to quality

(Shen et al., 2020). On research (Chithambo et al., 2020) revealed

that employee pressure had no effect on voluntary disclosure of carbon emissions.

External primary stakeholder, including consumers, environmentally sensitive industries, and creditors,

exert pressure on companies to disclose carbon information. According to research (Shen et al., 2020) consumer

pressure has a positive effect on disclosure of corporate carbon information. In contrast, Chithambo et al., (2020)

states that customer pressure has no effect on voluntary disclosure of carbon emissions. The type of industry that

is environmentally sensitive has a positive effect on the disclosure of carbon information (Tang et al., 2019).

However, Nastiti and Hardiningsih (2022) states that the type of industry has no effect on the disclosure of carbon

emissions. The greater the creditor pressure, the greater the disclosure of carbon information in research (Tang

et al., 2019) creditor pressure has a positive effect on disclosure of carbon information. Conversely, multiple

studies (Chithambo et al., 2020; Dandy Andriadi & Werastuti, 2020; Shen et al., 2020) states that creditor pressure

has no effect on disclosure of carbon emissions.

Secondary stakeholders are divided into two, namely media exposure and audits. Media exposure plays an

important role in informing the public about company activities including disclosure of carbon emissions. The

existence of supervision from the media and the organization will be increasingly racing to make disclosure of its

activities. Multiple research (Nastiti dan Hardiningsih, 2022; dan Cordova et al., 2020) explained that media

exposure has a positive effect on disclosure of carbon emissions. In research (Sandi et al., 2021) stated that media

exposure had no effect on carbon emissions disclosure. Companies audited by large Public Accounting Firms (KAP)

tend to make disclosures and information more extensive to their users. (Wardhani dan Kawedar, 2019; Shen et

al., 2020) found that the audit institution has a positive effect on the disclosure of corporate carbon information.

In research (He et al., 2019; Irwhantoko & Basuki, 2016) stated that KAP's reputation had no significant

involvement with the disclosure of carbon emissions.

Regulatory pressure namely pressure from the government as one of the company's stakeholders to control

the company's operational activities that have an impact on polluting the environment (Dewi et al., 2019). Studies

(Chithambo et al., 2020; Tang et al., 2019) shows that government pressure has a positive effect on disclosure of

corporate carbon emissions. While research (Dandy Andriadi & Werastuti, 2020; Sandi et al., 2021) revealed that

government pressure had no effect on disclosure of carbon emissions.

This study combines research findings from multiple research sources (Tang et al., 2019), (Chithambo et

al., 2020) (He et al., 2019) and (Nastiti & Hardiningsih. 2022). This study uses measurements of Carbon Disclosure

Information (CDI) as proposed by Shen et al., (2020) to measure the presence of carbon emissions in a company's

sustainability report and is expected to be able to disclose carbon emissions in companies in Indonesia. This

research uses non- financial companies listed on the Indonesia Stock Exchange in 2019-2021.

Hypothesis Development

1. Internal Primary Stakeholder

The influence of investor-oriented industries on disclosure of carbon emissions

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IJSSR Page 196

Industries that have many investors with a large shareholding spread are considered as investor-

oriented industries. Within these industries, investors find carbon information useful in their investment

decisions which can help investors find risks and opportunities in investing. Stakeholder theory gives the

position of shareholders or investors as stakeholders who are authorized to benefit from the company in

various forms of financial and non-financial information. Investor demand for disclosure of non-financial

information has increased accordingly (Tang et al., 2019). (Frynas & Yamahaki, 2016) Comprehensive company

disclosure is considered important for investors and other capital market players to make investment

decisions. Research (Shen et al., 2020; Tang et al., 2019) also revealed that investors can increase the level of

corporate carbon disclosure. Thus, comprehensive disclosure of financial and non-financial information will

increase transparency and reduce information asymmetry.

Hypothesis 1: Investor-oriented industries have a positive effect on disclosure of carbon emissions

The influence of employee-oriented industries on disclosure of carbon emissions

Today's employees are increasingly concerned about whether the company takes significant steps

toward addressing social and environmental issues or not. Therefore, a more transparent and quality

disclosure of carbon emissions must involve employees. Employee pressure influences the disclosure of carbon

emissions (Shen et al., 2020). (Guenther et al., 2016) Employees are also starting to pay attention to the

company's disclosed carbon performance. Companies with more employees are usually better organized so

they can address environmental issues by using their voice to reach higher levels of management. Stakeholder

theory explains that employees are important internal stakeholders, which can influence the company's

information disclosure behavior.

Hypothesis 2: Employee-oriented industries have a positive effect on disclosure of carbon emissions

2. Eksternal Primary Stakeholder

The influence of industry close to consumers on disclosure of carbon emissions

Consumers who are aware of the adverse effects of environmental damage, demand that their suppliers

of goods or services be transparent and accountable for the impact of their operations on the environment

(Halkos & Skouloudis, 2016). Promoting a positive corporate image can guarantee responsible behavior,

increase brand loyalty, and motivate consumers to buy products. To maintain good relations with consumers,

companies will try to disclose more relevant information about the environment and are expected to disclose

as much carbon information as possible to enhance the company's reputation and meet consumer information

needs that increase retention of old customers and attract new customers (Shen et al., 2020). Guenther et al.,

(2016) found that customers are also starting to pay attention to the company's disclosed carbon performance

for better decision-making. Legitimacy theory reveals that all companies will try to ensure that their activities

are accepted by the environment and society, including the end consumer.

Hypothesis 3: Industry close to consumer’s positive effect on the disclosure of carbon emission

The influence of environmentally sensitive industries on disclosure of carbon emissions

Companies that are part of the environmentally sensitive industry in carrying out their business

activities have a greater and greater influence in disclosing their carbon emissions. The statement was also

written by research (Tang et al., 2019) who found that companies operating in the fields of thermal power,

building materials, steel, chemicals, textiles, cement, papermaking, electrolytic aluminum, coal, metallurgy,

pharmaceuticals, petrochemicals, and brewing, have a major responsibility for environmental issues. . In

legitimacy theory, environmentally sensitive companies are more likely to face increasing pressure from

society, and companies need to disclose carbon emission reports to meet demand and gain legitimacy from

society. (He et al., 2019; Shen et al., 2020; Tang et al., 2019) has obtained evidence that environmentally

sensitive industries have a positive impact on disclosure of carbon emissions.

Hypothesis 4: Environmentally sensitive industries have a positive effect on disclosure of carbon emissions

The influence of creditor pressure on disclosure of carbon emissions

Creditors are individuals or groups of lenders who are stakeholders who can influence activities and

levels of information disclosure (Shen et al., 2020). Creditors demand that companies be transparent and

disclose more information, including environmental risk information. Results of research (Tang et al., 2019)

revealed that creditor pressure has a positive effect on disclosure of carbon emissions because companies with

creditor pressure have a beneficial effect on disclosure of carbon emissions. Stakeholder theory reveals that

creditors have power and can make legitimate demands through the loans they provide.

Hypothesis 5: Creditor pressure has a positive effect on disclosure of carbon emissions

3. Secondary Stakeholder

The influence of media exposure on disclosure of carbon emissions

International Journal of Social Service and Research,

Fina Dwi Nuriyani, R. Rosiyana Dewi

IJSSR Page 197

Expose corporate carbon information to the media caused by public demands on companies to gain

legitimacy from society. The media plays an important role in social mobilization movements, including

environmental advocacy groups (Cordova et al., 2020). Efforts to maintain good relations with stakeholders

can involve issuing a sustainability report (Hörisch et al., 2020). The publication of a sustainability report is

expected to provide useful information for achieving sustainability goals to stakeholders. Corporate

stakeholder theory strongly considers the importance of environmental disclosures that provide information

to stakeholders. The more disclosure of information in the media this can encourage companies to gain public

legitimacy and get positive responses from stakeholders.

Hypothesis 6: Media exposure has a positive effect on disclosure of carbon emissions

The influence of the Big Four KAP audits on disclosure of carbon emissions

KAP, or the Certified Public Accountant (CPA) firm, is responsible for presenting appropriate

information for users of financial statements to make decisions. Some clients assume that auditors who come

from large KAPs and are affiliated with international KAPs are more likely to provide high quality (Shen et al.,

2020). Auditors can influence client governance and take initiatives in promoting socially and environmentally

responsible accounting practices. Therefore, the more qualified an auditor is, the more information will be

obtained. (Wardhani dan Kawedar, 2019) The quality of a public accounting firm has an important role in

increasing client confidence in the opinion it provides.

Hypothesis 7: Big Four KAP audits have a positive effect on disclosure of carbon emissions

4. Regulatory Stakeholder

The influence of government pressure on disclosure of carbon emissions

The government is a stakeholder that plays a major role in regulating and influencing the business

activities of a company. Companies owned by the government are expected to be able to disclose more

environmental information because their accountability function receives budgetary funds from the

government (Dewi et al., 2019). The level of disclosure of environmental information by government-owned

companies (BUMN) is higher than non-government-owned companies (non-BUMN). This shows that BUMN

are more likely to convey to the public that they have fulfilled their social environmental responsibilities, thus

building a high-quality reputation that is positively responsive to the market (Tang et al., 2019). Stakeholder

theory that companies must comply with regulations and legitimacy attributes created by governments and

other regulatory agencies by establishing norms and guidelines for sustainability reporting practices.

Hypothesis 8: Government pressure has a positive effect on disclosure of carbon emissions

METHODS

A. Sampling and data

Carbon emission disclosure data comes from non-financial companies listed on the Indonesia Stock

Exchange from 2019 to 2021 using a purposive sampling method. The selection of the non-financial sector is

because this sector has a large influence on carbon emissions.

Table 1

Sample selection

Sector

2019-2021

Basic Materials

Consumer Cyclicals

Consumer Non-Cyclicals

Energy

Healthcare

Industrial

Infrastruktur

Properties & Real Estate

Transportation & Logistic

Total

196

100

Table 2

Sample by sector 2019-2021

Criteria

Total

Non-financial company listed on the IDX 2021

662

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IJSSR Page 198

Non-financial companies that are not consecutively listed on the IDX 2019-2021

100

Non-financial companies whose Annual Report is not complete 2019-2021

116

Non-financial companies whose Sustainability Report is incomplete 2019-2021

377

Number of samples (69 companies x 3 years)

207

Number of samples after Outliers (207-11)

196

For this study, the financial sector is not included. Additionally, the technology sector was not

used as a sample because it did not meet the sample selection criteria, namely that no one had

published a sustainability report consecutively for 2019-2021. In table 2 the basic material sector

represents the largest sample with 48 samples (24%), then the energy sector represents the second

largest sample with 41 samples (21%), and the smallest group is consumer cyclicals and properties

& real estate with 6 samples (3%).

B. Variable analysis

This research uses panel data regression analysis, which is a combination of two data, namely

cross- sectional data and time series data. Panel data is also often referred to as pooled data (Ghozali

dan Ratmono, 2020:195). Panel data regression equation:

CEDit = α + β1 INVESit + β2 EMPLOit + β3 CONSUit + β4 ENVIit + β5 CREDit + β6 EXPOit + β7

KAPit + β8 REGUit + β9 SIZEit + eit

C. Variable measurement

Measurement of carbon emission disclosure is proxied by scoring from research

developed by (Shen et al., 2020), in his research based on a Carbon Disclosure Information

(CDI) request sheet where the scoring is divided into 6 levels and 15 indexes according to

the following provisions:

Table 3

Carbon Disclosure Information (CDI)

Category

Frequency

Percentage

ENVI

0 = Not a high carbon industry

1 = High carbon industry

130

Total

196

100

EXPO

0 = Does not disclose full carbon emissions

1 = Disclose full carbon emissions

153

Total

196

100

KAP

0 = Non KAP Big 4

1 = KAP Big 4

125

Total

196

100

REGU

0 = Non BUMN

154

1 = BUMN

Total

196

100

0,000

0,200

0,400

0,600

0,800

1,000

1,200

1,400

1,600

1,800

2,000

I1 I2 I3 I4 I5 I6 I7 I8 I9 I10 I11 I12 I13 I14 I15

2019 2020 2021

Carbon Emission Disclosure Graph

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IJSSR Page 202

Descriptive statistics on the continuous variables in table 6 reveal that the disclosure of carbon

emissions has a minimum value of 0.133, a maximum value of 0.700 and an average of 0.457. This

indicates that the results of disclosing carbon emissions by companies are still very low. Investor-

oriented industries have a minimum value of 0.0032, a maximum value of 2.654 and an average of

0.146, suggesting that the proportion of public shares traded in the capital market is still small.

Employee-oriented industries have a minimum score of 0.0007, a maximum score of 2.622, and an

average of 0.188, signifying that employee involvement in company carbon information is still very

small. Industries near consumers have a minimum value of 0.00006, a maximum value of 0.211 and an

average of 0.026, indicating that there is fulfillment of information needs and approaches to consumers

are still low. Creditor pressure is a minimum value of 0.0015, a maximum value of 1.030 and an average

of 0.299, suggesting that the loans made by the company to creditors are of small value. As for control

variable size, it ranges from minimum value of 27.526 (IDR 901,060,986,000) to maximum value of

33,537 (IDR 367,311,000,000,000), with average value of 30,499. This indicates a substantial company

size, which is associated with a higher likelihood of disclosing carbon emissions.

The industry dummy variable is environmentally sensitive, indicates that 66 companies (34%)

belong to the low- carbon industry, and 130 companies (66%) belong to the high-carbon industry.

Regarding media exposure, 43 companies (22%) did not disclose complete carbon emission

information to the media, while 153 companies (78%) companies disclosed complete carbon emission

information to the media. For audits by KAP Big 4, 71 companies (36%) companies did not use BIG4

KAP audit services, whereas 125 companies (64%) used BIG4 KAP services. In term of government

pressure, 154 non-BUMN companies (79%) and 42 BUMN companies (21%) experienced government

pressure.

Table 7

Panel Effect Test Results

Test

Hypothesis

Count Statistics

Prob

Conclusion

Chow

: Common effect

: Fixed effect

Fstat = 5,74

0,0038

Fixed effect

Hausman

: Random effect

: Fixed effect

Chi-square = 10,4739

0,1633

Random effect

: Common effect

: Random effect

LM test = 59,249

0,0000

Random effect

The results of the Chow test in table 7 show that the probability value is 0.0038 < 0.05, so the

fixed effect is more appropriate. The Hausman test shows that the probability value is

0.1633 > 0.05, so the random effect is more appropriate. The Lagrange multiplier test shows that the

probability value is 0.0000 < 0.05, so the random effect is more appropriate. Therefore, it can be

concluded that the best model chosen is the random effect.

Table 8. Normality Test

Residual Models

Prob

Alpha

Conclusion

Asymp.Sig. (2-tailed)

0,065

0,05

Normal

The normality test in this study used the Jarque-Bera statistical test to produce a probability

value of 0.065 > 0.05. It can be concluded that the data is normally distributed.

Table 9. Multicollinearity Test

Variabel

VIF

Critical Value

Conclusion

INVES

1,052338

VIF < 10

Multicholinearity

Occurs

EMPLO

1,067431

CONSU

1,087237

ENVI

1,069929

CRED

1,055127

EXPO

1,025686

International Journal of Social Service and Research,

Fina Dwi Nuriyani, R. Rosiyana Dewi

IJSSR Page 203

KAP

1,054440

REGU

1,123112

SIZE

1,127010

The results of the multicollinearity test show that all variables have a VIF value <10 so it can

be concluded that the multicollinearity assumption has been met, which means that multicollinearity

does not occur, there is no correlation between the independent variables.

B. Determinants of carbon emissions disclosure

Table 10

Hypothesis Testing

Based on table 10, the panel data regression equation is as follows:

CEDit = -0,548938+ 0,039853 – 0,059887 + 0,874060 + 0,003560 – 0,053768 + 0,052829 +

0,003185 + 0,061255 + 0,031017 + e

The results of the R2 test in table 10 were obtained by Adj. R-Square of 0.18387 means that the

contribution of all independent variables to the increase or decrease in disclosure of carbon

emissions is 18.38%, the remaining 81.62% is influenced by other variables not included in the

model.

The results of the F test in Table 10 obtained an F-Statistic probability of 0.0000 <0.05. It

can be concluded that all independent variables jointly or simultaneously have a significant effect on

disclosure of carbon emissions.

The results of the T test in table 10 explain the independent variables on the dependent

variable as follows: Investment-oriented industries have a positive effect on disclosure of carbon

emissions with a probability value of 0.019, which is less than 0.05 with a coefficient of 0.039. It

concludes that H1 is accepted. A larger proportion of shares traded means that public shareholders

have more voice which creates pressure on companies and encourages disclosure of carbon

information. (Shen et al., 2020; Tang et al., 2019) investors can increase the level of corporate carbon

disclosure.

Employee-oriented industries have a negative effect on disclosure of carbon emissions with a

probability value of 0.029, which is less than 0.05 with a coefficient of -0.059. This leads to conclusion

that H2 is rejected. Employee- oriented industries reduce the quality of disclosure of carbon

emissions, meaning that there is a lack of evidence stating that employees demand more disclosure

of carbon emissions to companies, because it will increase the company's burden and employees do

not have full rights to corporate environmental responsibility.

Industries close to consumers have a positive effect on disclosure of carbon emissions with a

probability value of 0.0013, which is less than 0.05 with a coefficient of 0.874. It is concluded that H3

is accepted. Through advertising, companies try to disclose more relevant information to establish

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INVES

0,039853

2,079744

0,01945

H1 accepted

EMPLO

-0,059887

-1,893476

0,0299

H2 rejected

CONSU

0,874060

3,047524

0,0013

H3 accepted

ENVI

0,003560

0,022628

0,4376

H4 rejected

CRED

-0,053768

-1,761287

0,0399

H5 rejected

EXPO

0,052829

3,638655

0,0002

H6 accepted

KAP

0,003185

0,149273

0,44075

H7 rejected

REGU

0,061255

2,248474

0,01285

H8 accepted

SIZE

0,031017

3,834298

0,0001

-0,548938

-2,227914

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0,1838

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0,0000

International Journal of Social Service and Research https://ijssr.ridwaninstitute.co.id/

IJSSR Page 204

good relationships between consumers and suppliers (Shen et al., 2020). So, it can be seen directly

that consumers have an influence on the disclosure of carbon emissions so that companies tend to

be more transparent in their operations. Promoting a positive corporate image can guarantee

responsible behavior, increase brand loyalty and motivate consumers to buy products (Halkos &

Skouloudis, 2016).

Environmentally sensitive industries have no effect on disclosure of carbon emissions, having a

probability value of 0.437 > 0.05 with a coefficient of 0.003, it is concluded that H4 is rejected.

Companies that disclose carbon emissions are not only carried out by industry sensitive companies,

non-industry sensitive companies also disclose carbon emissions, disclosure of carbon emissions

depends on management policies not from sensitive industry types.(Tana & Diana, 2021) Disclosure of

carbon emissions is a management policy of every company not influenced by environmentally sensitive

industries. Intensive industrial types that produce low emission levels in their disclosures will be

highlighted by the government and the community from various social and environmental fields so that

they can make the company have a bad image (Nastiti & Hardiningsih, 2022).

Creditor pressure has a negative effect on disclosure of carbon emissions, has a probability value

of 0.039, which is less than 0.05 with a coefficient of -0.053. It is concluded that H5 is rejected.

Companies that have a large proportion of loans do not always disclose carbon emissions considering

this creates extra costs. (Florencia & Handoko, 2021) Good environmental performance does not always

make companies disclose carbon emissions to apply for loans. (Prasetya, 2017) Creditors generally

pressure companies to use available resources as effectively as possible so that payment of obligations

remains smooth. Creditors may be interested in other disclosures that have a more direct effect on the

company's finances, therefore companies make more financial disclosures (Chithambo et al., 2020).

Media exposure has a positive effect on disclosure of carbon emissions having a probability value

of 0.0002, which is less than 0.05 with a coefficient of 0.052, concluded that H6 is accepted. With

supervision from the media, companies will be increasingly motivated to make disclosures of their

activities. (Cordova et al., 2020) Reporting of carbon emissions is influenced by the company's

sustainability profile which is proxied by publishing social responsibility reports. (Nastiti dan

Hardiningsih, 2022) due to excessive concern regarding corporate environmental monitoring,

corporate activities related to carbon emissions are exposed openly in the media.

KAP Big 4 audit has no effect on disclosure of carbon emissions has a probability value of 0.440,

which is more than 0.05 with a coefficient of 0.003, concluded H7 is rejected. Reputation KAP is not

involved with the disclosure of carbon emissions. (Irwhantoko & Basuki, 2016) This finding is because

the Public Accounting Firm in Indonesia from the Big Four or other groups is not an independent

institution entitled to carry out carbon emission assessments. Carbon emission assessment is carried

out by an accredited independent body, namely a Designated Operational Entity (DOE) to validate and

verify carbon emission reductions. It is stated that (He et al., 2019) KAP's reputation has no involvement

with carbon emissions disclosure.

Government pressure has a positive effect on disclosure of carbon emissions, has a probability

value of 0.012, which is less than 0.05 with a coefficient of 0.061. It is concluded that H8 is accepted. The

level of environmental information disclosure is higher in state-owned enterprises compared to non-

state-owned companies, this shows that BUMN are more likely to convey to the public that they have

fulfilled their social and environmental responsibilities to build a high-quality reputation that is

positively responsive to the market. (Chithambo et al., 2020; Tang et al., 2019) Government pressure

influences corporate environmental behavior.

The control variable firm size has a positive effect on disclosure of carbon emissions, this shows

good results and consistent prob values. 0.0001, which is less than 0.05 with a coefficient of 0.031.

Companies that acquire large assets have great pressure from stakeholders who have high expectations

regarding disclosure of carbon emissions. This shows that large companies have greater pressure on

environmental issues. (Tang et al., 2019) Large companies are more encouraged to provide quality

voluntary disclosures. The research results are in accordance with (Nastiti dan Hardiningsih, 2022;

Chithambo et al., 2020; He et al., 2019).

CONCLUSION

This study examines the disclosure of carbon emissions of Indonesian non-financial companies.

The results of the research that has been described have concluded that investor-oriented industries,

International Journal of Social Service and Research,  
Fina Dwi Nuriyani, R. Rosiyana Dewi 
 
IJSSR Page 205 
close-consumer  industries,  media  exposure,  and  government  pressure  have  a  positive  effect  on 
disclosure of carbon emissions with a significant level of 0.05 (H1, H3, H6, H8 are accepted), employee-
oriented industries , and creditor pressure has a negative effect on disclosure of carbon emissions with 
a  significant  level of  0.05 (H2,  H5  are  rejected),  environmentally  sensitive industries  and  KAP  Big4 
audits have no effect on disclosure of carbon emissions with a significant level of 0.05 (H4 and H7 are 
rejected). Based on the research results, it proves that stakeholders, investors, consumers, media, and 
government support previous research and underlie stakeholder and legitimacy theories. 
This research has implications for various parties such as stakeholders, especially the government 
in formulating policies and being able to understand the importance of maximizing the disclosure of 
carbon emissions produced by companies as a responsibility to people, planet, social and environment 
that can attract investors. The government can supervise and provide stricter policies to companies. 
 
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Fina Dwi Nuriyani, R. Rosiyana Dewi (2023)

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