TY - JOUR
T1 - Sustainability report, ownership types, and cost of capital
T2 - Evidence on investors’ reaction of indonesian listed companies
AU - Sari, Raisya Arum
AU - Rossieta, Hilda
N1 - Publisher Copyright:
© Sari and Rossieta.
PY - 2019/1/1
Y1 - 2019/1/1
N2 - Purpose: This research aims to examine investors’ reactions to the Sustainability Report (SR) and the moderating effect of ownership types associated with stakeholders’ interdependence theory. Methodology: This research uses purposive sampling method to choose the samples. The population of the samples is Indonesian listed companies that disclose sustainability reports from 2014 to 2016. This research uses secondary data using several data sources, such as the annual report, financial report, sustainability report, data stream database, and another secondary source. Results: In general, empirical evidence indicate that investors appreciate sound SR performance by the tendency to give a discount on their investment; hence, they charge low Cost of Capital. Also, types of ownership do have a moderating effect on investors’ reaction, suggesting the existence of interdependent among stakeholders group. Implications: This research captures investors' reactions by looking at the Cost of the Capital bear by the company as a proxy for investor reaction on the perceived risk associated with the sustainability issues. Moreover, this research converts the Cost of Capital as a continuous variable into a categorical variable of high and low.
AB - Purpose: This research aims to examine investors’ reactions to the Sustainability Report (SR) and the moderating effect of ownership types associated with stakeholders’ interdependence theory. Methodology: This research uses purposive sampling method to choose the samples. The population of the samples is Indonesian listed companies that disclose sustainability reports from 2014 to 2016. This research uses secondary data using several data sources, such as the annual report, financial report, sustainability report, data stream database, and another secondary source. Results: In general, empirical evidence indicate that investors appreciate sound SR performance by the tendency to give a discount on their investment; hence, they charge low Cost of Capital. Also, types of ownership do have a moderating effect on investors’ reaction, suggesting the existence of interdependent among stakeholders group. Implications: This research captures investors' reactions by looking at the Cost of the Capital bear by the company as a proxy for investor reaction on the perceived risk associated with the sustainability issues. Moreover, this research converts the Cost of Capital as a continuous variable into a categorical variable of high and low.
KW - Investors’ Reaction
KW - Ownership Types
KW - SR performance
KW - Stakeholders’ Interdependent
KW - Sustainability Report
UR - http://www.scopus.com/inward/record.url?scp=85081622132&partnerID=8YFLogxK
U2 - 10.18510/hssr.2019.76177
DO - 10.18510/hssr.2019.76177
M3 - Article
AN - SCOPUS:85081622132
SN - 2395-6518
VL - 7
SP - 1246
EP - 1255
JO - Humanities and Social Sciences Reviews
JF - Humanities and Social Sciences Reviews
IS - 6
ER -