Effect Of Corporate Social Responsibility Disclosure On The Value Of The Company With Capital Structure Policy As A Modeling Variable In Property Companies Listed On The Indonesia Stock Exchange

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The Effect of Corporate Social Responsibility Disclosure on the Value of the Company with Capital Structure Policy as a Modeling Variable in Property Companies Listed on the Indonesia Stock Exchange

Introduction

In recent years, Corporate Social Responsibility (CSR) has become a crucial aspect of business operations, with companies increasingly focusing on their social and environmental impact. As a result, investors and stakeholders are paying closer attention to CSR disclosure, which is seen as a key indicator of a company's commitment to social responsibility. However, the relationship between CSR disclosure and company value remains unclear, particularly in the context of property companies listed on the Indonesia Stock Exchange (BEI). This study aims to analyze the effect of CSR disclosure on company value with capital structure policies as moderation variables, specifically in property companies listed on the BEI.

Background

Corporate Social Responsibility (CSR) is a concept that refers to a company's voluntary efforts to improve social, environmental, and economic outcomes. CSR disclosure is a key aspect of CSR, as it provides stakeholders with information about a company's social and environmental performance. In recent years, CSR disclosure has become increasingly important, with many investors and stakeholders considering it a key factor in their investment decisions. However, the relationship between CSR disclosure and company value remains unclear, particularly in the context of property companies.

Methodology

This study uses a causal associative research design with a sample consisting of 15 property companies listed on the BEI during the period 2008 to 2010. The data used in this study are secondary data obtained from the official BEI website (www.idx.co.id) and Indonesian Capital Market Directory (ICMD). The dependent variable in this study is the company's value, while the independent variable is CSR, and the capital structure policy functions as a moderation variable. The analysis used in this study was multilinear regression analysis, as well as testing the absolute difference value for statistical analysis, which had previously been tested with a classic assumption test.

Results

The results of partial testing show that CSR as an independent variable has no significant influence on the company's value. In addition, the results of the absolute difference value test also show that the capital structure policy does not function as a moderation variable. These findings suggest that CSR disclosure may not have a direct impact on company value, at least in the context of property companies listed on the BEI.

Additional Analysis and Explanation

The results of this study raise questions about other factors that can affect the relationship between CSR and company value, as well as the role of capital structure policies in the context. One explanation might be that although CSR contributes to the positive image of the company, the impact on company value may not be immediately seen in the short term. Many investors still focus more on their attention to short-term financial performance than aspects of social responsibility carried out by the company.

In addition, industrial differences can also affect the effectiveness of CSR in increasing company value. In the property industry, company value may be more influenced by other factors such as market conditions, property locations, and government policies rather than by CSR activities. Therefore, property companies may need to re-evaluate their CSR strategies to ensure that these efforts are able to have a clearer positive impact on the company's value.

Capital structure policy as a moderation variable also raises questions. The optimal capital structure is important to minimize capital costs and maximize company value. If the company does not have the right capital structure, the CSR policy applied may not have a significant impact on the company's value. In other words, companies that have a good capital structure can be more effective in implementing CSR and giving benefits to the practice.

Conclusion

In conclusion, this research provides valuable insight into the relationship between CSR, company value, and capital structure policies in the Indonesian property sector. Although this study shows that CSR disclosure has no significant influence on company value, it is essential for companies to continue to consider their social responsibility as part of a broader business strategy. By doing so, companies can create a positive image and contribute to the well-being of society, which can ultimately lead to long-term success and sustainability.

Recommendations

Based on the findings of this study, the following recommendations can be made:

  1. Re-evaluate CSR strategies: Property companies may need to re-evaluate their CSR strategies to ensure that these efforts are able to have a clearer positive impact on the company's value.
  2. Focus on short-term financial performance: Many investors still focus more on their attention to short-term financial performance than aspects of social responsibility carried out by the company.
  3. Optimize capital structure: Companies that have a good capital structure can be more effective in implementing CSR and giving benefits to the practice.
  4. Continuously monitor and evaluate CSR performance: Companies should continuously monitor and evaluate their CSR performance to ensure that it is aligned with their business strategy and goals.

Limitations

This study has several limitations that should be noted. Firstly, the sample size is relatively small, consisting of only 15 property companies listed on the BEI. Secondly, the study only focuses on property companies listed on the BEI, which may not be representative of all property companies in Indonesia. Finally, the study only examines the relationship between CSR disclosure and company value, and does not consider other factors that may influence company value.

Future Research Directions

Future research directions can be identified as follows:

  1. Examine the relationship between CSR and company value in other industries: This study only focuses on property companies listed on the BEI, and it would be interesting to examine the relationship between CSR and company value in other industries.
  2. Investigate the impact of CSR on company value in the long term: This study only examines the relationship between CSR and company value in the short term, and it would be interesting to investigate the impact of CSR on company value in the long term.
  3. Explore the role of capital structure policies in CSR implementation: This study only examines the role of capital structure policies as a moderation variable, and it would be interesting to explore the role of capital structure policies in CSR implementation.

Conclusion

In conclusion, this study provides valuable insight into the relationship between CSR, company value, and capital structure policies in the Indonesian property sector. Although this study shows that CSR disclosure has no significant influence on company value, it is essential for companies to continue to consider their social responsibility as part of a broader business strategy. By doing so, companies can create a positive image and contribute to the well-being of society, which can ultimately lead to long-term success and sustainability.
Frequently Asked Questions (FAQs) about the Effect of Corporate Social Responsibility Disclosure on the Value of the Company with Capital Structure Policy as a Modeling Variable in Property Companies Listed on the Indonesia Stock Exchange

Q: What is Corporate Social Responsibility (CSR) and how does it relate to company value?

A: CSR refers to a company's voluntary efforts to improve social, environmental, and economic outcomes. While CSR disclosure is a key aspect of CSR, the relationship between CSR disclosure and company value remains unclear. This study aims to analyze the effect of CSR disclosure on company value with capital structure policies as moderation variables, specifically in property companies listed on the Indonesia Stock Exchange (BEI).

Q: What is the significance of CSR disclosure in the context of property companies?

A: CSR disclosure is increasingly important in the context of property companies, as it provides stakeholders with information about a company's social and environmental performance. Property companies may need to re-evaluate their CSR strategies to ensure that these efforts are able to have a clearer positive impact on the company's value.

Q: What is the role of capital structure policy in CSR implementation?

A: Capital structure policy plays a crucial role in CSR implementation, as it can affect the company's ability to implement CSR policies effectively. Companies with a good capital structure can be more effective in implementing CSR and giving benefits to the practice.

Q: What are the limitations of this study?

A: This study has several limitations, including a relatively small sample size and a focus on property companies listed on the BEI. Additionally, the study only examines the relationship between CSR disclosure and company value, and does not consider other factors that may influence company value.

Q: What are the implications of this study for property companies?

A: The findings of this study suggest that property companies may need to re-evaluate their CSR strategies to ensure that these efforts are able to have a clearer positive impact on the company's value. Additionally, companies should continuously monitor and evaluate their CSR performance to ensure that it is aligned with their business strategy and goals.

Q: What are the future research directions for this study?

A: Future research directions can include examining the relationship between CSR and company value in other industries, investigating the impact of CSR on company value in the long term, and exploring the role of capital structure policies in CSR implementation.

Q: What are the benefits of CSR implementation for property companies?

A: CSR implementation can have several benefits for property companies, including improved reputation, increased customer loyalty, and enhanced brand image. Additionally, CSR implementation can contribute to the well-being of society, which can ultimately lead to long-term success and sustainability.

Q: How can property companies measure the effectiveness of their CSR implementation?

A: Property companies can measure the effectiveness of their CSR implementation by tracking key performance indicators (KPIs) such as employee engagement, customer satisfaction, and community impact. Additionally, companies can conduct regular audits and assessments to ensure that their CSR policies are aligned with their business strategy and goals.

Q: What are the challenges of CSR implementation for property companies?

A: Property companies may face several challenges when implementing CSR, including limited resources, lack of expertise, and conflicting priorities. Additionally, companies may struggle to measure the effectiveness of their CSR implementation and may need to invest in training and development programs to build capacity.

Q: How can property companies overcome the challenges of CSR implementation?

A: Property companies can overcome the challenges of CSR implementation by developing a clear CSR strategy, allocating sufficient resources, and building partnerships with stakeholders. Additionally, companies can invest in training and development programs to build capacity and can establish a CSR committee to oversee CSR implementation.

Q: What are the future trends in CSR implementation for property companies?

A: Future trends in CSR implementation for property companies may include increased focus on sustainability, environmental responsibility, and social impact. Additionally, companies may need to adapt to changing regulatory requirements and stakeholder expectations, and may need to invest in technology and innovation to stay ahead of the curve.