ABSTRACT

Devina, Patricia (2022). The effect of environmental performance, environmental costs, and profitability on firm value with disclosure of greenhouse gas emissions as mediating variables. Supervisor 1: Muhammad Hudaya, Supervisor 2: Wahyudin Nor

Introduction/Main Objectives: Company reputation contributes to the perception of corporate values. Since the global warming issue has emerged, stakeholders who care about the environment have become more aware of a company's impact on the environment and have made the company's environmental performance a critical factor in increasing corporate value. Environmental factors and fundamental factors such as profitability determine a company's value. This study aims to see how environmental performance, environmental costs, and profitability affect firm value by using greenhouse gas emissions disclosure as a moderating variable.

Research Methods: This research uses an explanatory quantitative approach. The population of this study is the energy sector companies listed on the Indonesia Stock Exchange for 2016–2020 with a 5-year observation period. The variables used in this study are environmental performance, environmental costs, profitability as measured by ROA, greenhouse gas emissions disclosure, and firm value measured by PBV.

Finding/Results: The results of this study show some significant direct effects of environmental costs and profitability (ROA) on greenhouse gas emissions disclosure and environmental performance on firm value (PBV), but there were no significant effects between environmental costs and profitability on firm value (PBV). On the other hand, this study also demonstrates that disclosure of greenhouse gas emissions can significantly affect firm value and mediate the effect between environmental cost and profitability on firm value.

Contribution: This research provides a new perspective on the company's efforts to protect and preserve the environment by paying attention to every detail and policy, which is beneficial for the environment and society and can bring good benefits to the company itself.

Keywords: Environmental Performance, Environmental Costs, Profitability, Firm Value, Greenhouse Gas Emissions Disclosure