Green Credit, Corporate Social Responsibility and Company Value: Evidence From Indonesia and China Banks

Authors

  • Ersilda Dos Santos Mota Soares Diponegoro University
  • Irene Rini Demi Pangestuti Diponegoro University

DOI:

https://doi.org/10.26905/afr.v7i3.13019

Keywords:

Company Value, Corporate Social Responsibility, Green Credit, Profitability

Abstract

The objective of this study is to investigate the influence of green credit and Corporate Social Responsibility (CSR) on company value, with profitability as a mediating factor, in banks in Indonesia and China from 2019 to 2022. This research uses a purposive sampling method in selecting the sample. The objects in this research are banks in Indonesia and China. Data analysis in this research uses multiple linear regression analysis. The findings reveal that green credit significantly affects profitability, whereas CSR does not. Neither green credit nor CSR directly impacts company value, but profitability as a mediating variable significantly influences company value. Indirectly, green credit through profitability significantly affects company value, while CSR does not. This research provides interesting contributions to stakeholders, related to green credit and sustainability programs. Therefore, this study can offer new insights. Limitations include the study's focus on a limited sample of banks that offer green credit and CSR, the restriction to four years of data without accounting for external factors like the COVID-19 pandemic, and the use of a single analytical tool.

JEL Classification: G32; Q56; M14; L25

DOI: https://doi.org/10.26905/afr.v7i3.13019

Downloads

Download data is not yet available.

References

Akal, A. T. U., Gaffar, S., R, M., Basir, M., & Mashuddin, N. (2023). Disclosure of Corporate Social Responsibility on Firm Value Trough Financial Performance. Atestasi : Jurnal Ilmiah Akuntansi, 6(1), 83–102. https://doi.org/10.57178/atestasi.v6i1.605

Alsartawi, A. M. (2020). Does it pay to be socially responsible? Empirical evidence from the GCC countries. International Journal of Law and Management, 62(5), 381–394. https://doi.org/10.1108/IJLMA-11-2018-0255

Andaiyani, S., Muthia, F., & Novriansa, A. (2023). Green credit and bank performance in Indonesia. Diponegoro International Journal of Business, 6(1), 50–56. https://doi.org/10.14710/dijb.6.1.2023.50-56

Ang, R., Shao, Z., Liu, C., Yang, C., & Zheng, Q. (2022). The Relationship Between CSR And Financial Performance And The Moderating Effect Of Ownership Structure: Evidence From Chinese Heavily Polluting Listed Enterprises. Sustainable Production and Consumption, 30, 117–129. https://doi.org/10.1016/j.spc.2021.11.030

Asad, H., & Khan, U. (2021). Leadership Behavior and Sustainable Leadership among Higher Education Institutions of Pakistan, 2021 Sustainable Leadership and Academic Excellence International Conference (SLAE), Manama, Bahrain, 2021, pp. 1-6, doi: 10.1109/SLAE54202.2021.9788081

Dafermos, Y., & Nikolaidi, M. (2021). How can green differentiated capital requirements affect climate risks? A dynamic macrofinancial analysis. Journal of Financial Stability, 54, 100871. https://doi.org/10.1016/j.jfs.2021.100871

Danye, H. (2020). Research on the impact of green credit on profitability of commercial banks in China. E3S Web of Conferences, 214. https://doi.org/10.1051/e3sconf/202021403008

Gunawan, J., Permatasari, P., & Sharma, U. (2022). Exploring sustainability and green banking disclosures: a study of banking sector. Environment, Development and Sustainability, 24(9), 11153–11194. https://doi.org/10.1007/s10668-021-01901-3

Haryanto, S., Rahadian, N., Mbapa, M. F. I., Rahayu, E. N., & Febriyanti, K. V. (2018). Kebijakan Hutang, Ukuran Perusahaan dan Kinerja Keuangan Terhadap Nilai Perusahaan: Industri Perbankan di Indonesia. AFRE (Accounting and Financial Review), 1(2), 62–70. https://doi.org/10.26905/afr.v1i2.2279

Harun, M. S., Hussainey, K., Mohd Kharuddin, K. A., & Farooque, O. al. (n.d.). CSR Disclosure, Corporate Governance and Firm Value: a study on GCC Islamic Banks. International Journal of Accounting and Information Management, 28(4), 607–638. https://doi.org/10.1108/IJAIM-08-2019-0103

He, L., Wu, C., Yang, X., & Liu, J. (2019). Corporate social responsibility, green credit, and corporate performance: an empirical analysis based on the mining, power, and steel industries of China. Natural Hazards, 95(1–2), 73–89. https://doi.org/10.1007/s11069-018-3440-7

Huang, G., Ye, F., Li, Y., Chen, L., & Zhang, M. (2022). Corporate social responsibility and bank credit loans: Exploring the moderating effect of the institutional environment in China. Asia Pacific Journal of Management. https://doi.org/10.1007/s10490-021-09800-x

Jemunu, M. D., Apriyanto, G., & Parawiyati, P. (2021). Good corporate governance, pengungkapan sustainability report dan manajemen laba terhadap nilai perusahaan. AFRE (Accounting and Financial Review), 3(2), 93–102. https://doi.org/10.26905/afr.v3i2.5195

Kamaliah. (2020). Disclosure of corporate social responsibility (CSR) and its implications on company value as a result of the impact of corporate governance and profitability. International Journal of Law and Management, 62(4), 339–354. https://doi.org/10.1108/IJLMA-08-2017-0197

Kurniawan, R. N., & Susanti, M. (2023). Factors That Affect Firm Value In Manufacturing Firms. International Journal of Application on Economics and Business (IJAEB), 1(2), 2987–1972. https://doi.org/10.24912/ijaeb.v1.i2.871-879

Kuruppu, S. C., Milne, M. J., & Tilt, C. A. (2019). Gaining, maintaining and repairing organisational legitimacy: When to report and when not to report. Accounting, Auditing and Accountability Journal, 32(7), 2062–2087. https://doi.org/10.1108/AAAJ-03-2013-1282

Lai, X., Yue, S., & Chen, H. (2022). Can green credit increase firm value? Evidence from Chinese listed new energy companies. Environmental Science and Pollution Research, 29(13), 18702–18720. https://doi.org/10.1007/s11356-021-17038-9

Lamperti, F., Bosetti, V., Roventini, A., Tavoni, M., & Treibich, T. (2021). Three green financial policies to address climate risks. Journal of Financial Stability, 54, 100875. https://doi.org/10.1016/j.jfs.2021.100875

Lauren, N., Daud, I., Malini, H., & Jaya, A. (2023). Does corporate social responsibility moderate financial performance and firm size on firm value? In IJAFIBS (Vol. 11, Issue 3). www.ijafibs.pelnus.ac.id

Lian, Y., Gao, J., & Ye, T. (2022). How Does Green Credit Affect The Financial Performance Of Commercial Banks? —Evidence From China. Journal of Cleaner Production, 344. https://doi.org/10.1016/j.jclepro.2022.131069

Machmuddah, Z., Sari, D. W., & Utomo, S. D. (2020). Corporate social responsibility, profitability and firm value: Evidence from Indonesia. Journal of Asian Finance, Economics and Business, 7(9), 631–638. https://doi.org/10.13106/JAFEB.2020.VOL7.NO9.631

Mohammadi, S., & Saeidi, H. (2022). Corporate Social Responsibility And Financial Accounting Concepts: Evidence From An Emerging Market. Sustainability Accounting, Management and Policy Journal, 13(3), 740–764. https://doi.org/10.1108/SAMPJ-10-2019-0364

Naifar, N. (2023). Does climate change affect sovereign credit risk? International evidence. Borsa Istanbul Review, 23(2017), S84–S95. https://doi.org/10.1016/j.bir.2023.10.001

Ngo, Q. T., Tran, H. A., & Tran, H. T. T. (2022). The Impact Of Green Finance And Covid-19 On Economic Development: Capital Formation And Educational Expenditure Of ASEAN Economies. China Finance Review International, 12(2), 261–279. https://doi.org/10.1108/CFRI-05-2021-0087

Nuryana, I., & Bhebhe, E. (2019). Pengungkapan Corporate Social Responsibility Terhadap Nilai Perusahaan Dengan Profitabilitas Sebagai Variabel Moderating. AFRE (Accounting and Financial Review), 2(2), 142–146. https://doi.org/10.26905/afr.v2i2.3261

Qonita, F., Moeljadi, M., & Ratnawati, K. (2022). The Influence of Corporate Social Responsibility on Firm Value Through Corporate Reputation and Financial Performance. In International Journal of Environmental, Sustainability, and Social Sciences, 3(3).

Putri, R., Nyoman, D., Werastuti, S., Risfandy, T., & Dewi, T. R. (2023). The Determinants of Company Value: Green Accounting, CSR, and Profitability. AFRE Accounting and Financial Review, 6(1), 115–126. https://jurnal.unmer.ac.id/index.php/afr

Sutrisno, & Furqan, A. M. (2024). Determinants of Green Credit and Their Influence on Banking Profitability in Indonesia. Riset Akuntansi Dan Keuangan Indonesia, 9(1), 35–49. https://doi.org/10.23917/reaksi.v9i1.3906

Udeagha, M. C., & Ngepah, N. (2023). The drivers of environmental sustainability in BRICS economies: Do green finance and fintech matter? World Development Sustainability, 3(December 2022), 100096. https://doi.org/10.1016/j.wds.2023.100096

Wang, Y., Lei, X., Zhao, D., Long, R., & Wu, M. (2021). The dual impacts of green credit on economy and environment: Evidence from China. Sustainability (Switzerland), 13(8), 1–13. https://doi.org/10.3390/su13084574

Yin, W., Zhu, Z., Kirkulak-Uludag, B., & Zhu, Y. (2021). The Determinants Of Green Credit And Its Impact On The Performance Of Chinese Banks. Journal of Cleaner Production, 286. https://doi.org/10.1016/j.jclepro.2020.124991

Zhou, G., Sun, Y., Luo, S., & Liao, J. (n.d.). Corporate Social Responsibility And Bank Financial Performance In China: The Moderating Role Of Green Credit. Energy Economics, 97. https://doi.org/10.1016/j.eneco.2021.105190

ZIiaul, I. M., & Shuwei, W. (2023). Environmental Sustainability: A Major Component of Sustainable Development. International Journal of Environmental, Sustainability, and Social Science, 4(2), 620–627. https://doi.org/10.38142/ijesss.v4i2.296

Additional Files

Published

2024-11-20 — Updated on 2024-11-20

How to Cite

Soares, E. D. S. M., & Pangestuti, I. R. D. (2024). Green Credit, Corporate Social Responsibility and Company Value: Evidence From Indonesia and China Banks. AFRE (Accounting and Financial Review), 7(3), 290–300. https://doi.org/10.26905/afr.v7i3.13019

Issue

Section

Similar Articles

1 2 3 > >> 

You may also start an advanced similarity search for this article.