The Effect of Corporate Social Responsibility and Corporate Governance on Financial Distress in Manufacturing Sector Companies

Nofrizal Bagas Wardana, Herlita Mutyarawati, Scholastica Meillia Purwidyasari, Henny Setyo Lestari, Farah Margaretha Leon

Abstract


This study analyzes and examines the effect that cash flow has on financial distress and corporate social responsibility through moderation by the role of corporate governance. The sample of companies applied is manufacturing companies in Indonesia and listed on the Indonesia Stock Exchange with the period 2019 - 2021. The samples that fit the criteria were found to be 44 companies. The data obtained through purposive sampling and using secondary data from the annual report published by each company. The results of this study indicate that financial distresst-1 has a positive effect on financial distress significantly. corporate social responsibility does not affect financial distress. Corporate governance has a positive effect on financial distress significantly. Cash flow has a negative and significant effect on financial distress. Leverage has a negative and significant effect on financial distress. Asset tangibility does not affect financial distress. Corporate governance moderates the effect of corporate social responsibility on financial distress.


Keywords


Financial distress; corporate social responsibility; cashflow; corporate governance.

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DOI: https://doi.org/10.26905/jkdp.v27i2.10685

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