Governance and Management Accounting: Board Size, Environmental Committee, and Audit Committee on Environmental Performance

Abstract

Purposes: This research explores how the board and environmental committee impact environmental performance in Indonesia, with the audit committee serving as a moderating factor.

Methods: The study draws data from annual reports of mining and manufacturing firms for the period 2019-2023. Thus, the total panel data in this study is 115 analysis units. This study uses Moderating Regression Analysis (MRA) with SPSS 26.

Findings: Environmental disclosure is a key metric to assess environmental performance. Therefore, this study finds that the board’s influence on environmental disclosure is not statistically significant. Then, the environmental disclosure could moderate the impact of the environmental committee on environmental disclosure. This study reveals that audit committees weaken the interaction between environmental committees and environmental disclosure. However, the audit committee failed to moderate the interaction between the board and environmental disclosure.

Novelty: The high demands of society for environmental disclosure have put pressure on companies. As a result, companies take various inappropriate actions by presenting environmental disclosures that do not follow corporate behavior. Based on this background, this study investigates how corporate performance and corporate governance practices, including the board, environmental commit- tee, and audit committee. This study is essential because the audit committee is critical in improving good corporate governance.