An Analysis of Sustainable Finance Disclosure at Indonesian Sharia Commercial Banks using POJK 51/POJK.03/2017

Its Determinants and Influence on the Profitability

DOI

10.2991/aer.k.211106.085How to use a DOI?

Keywords

Sustainable finance disclosure; Sharia commercial bank; POJK 51/POJK.03/2017; Elements of corporate governance; Profitability

Abstract

Sustainable finance is a business principle that can generate profit today without sacrificing future generations by considering the economic, social, and environmental aspects. Regulation on the implementation of sustainable finance for financial service institutions (FSI), issuers, and public companies issued by the Financial Service Authority/Otoritas Jasa Keuangan (FSA/OJK) is arranged in the Financial Service Authority Regulation/Peraturan OJK (POJK) Number 51/POJK.03/2017. FSI consists of all banks in Indonesia, including sharia commercial banks. This research aims to measure the level of sustainable finance disclosure in sharia commercial banks using POJK 51/ POJK.03/2017, testing its determinants i.e., corporate governance elements which consist of board of directors, independent directors, and audit committee, and observing its influence on the profitability. The study sample is 10 PSB issuing sustainable reports and annual reports on their websites with an observation period of 4 years (2016-2019). The data were analyzed using Partial Least Square-Structural Equation Model (PLS-SEM). The study results show that sustainable finance disclosure is executed at a high level. Furthermore, the board of directors and the audit committee are determinants that have a positive effect on sustainable finance disclosure, while independent directors have a negative effect. However, sustainable finance disclosure itself has no effect on profitability.

Copyright

© 2021 The Authors. Published by Atlantis Press International B.V.

Open Access

This is an open access article under the CC BY-NC license.

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TY  - CONF
AU  - Haqqi Lailatul Qudriyah
AU  - Hastuti
AU  - Dian Imanina Burhany
AU  - Sumiyati Sumardi
PY  - 2021
DA  - 2021/11/23
TI  - An Analysis of Sustainable Finance Disclosure at Indonesian Sharia Commercial Banks using POJK 51/POJK.03/2017
BT  - Proceedings of the 2nd International Seminar of Science and Applied Technology (ISSAT 2021)
PB  - Atlantis Press
SP  - 544
EP  - 551
SN  - 2352-5401
UR  - https://doi.org/10.2991/aer.k.211106.085
DO  - 10.2991/aer.k.211106.085
ID  - Qudriyah2021
ER  -