WSEAS Transactions on Business and Economics


Print ISSN: 1109-9526
E-ISSN: 2224-2899

Volume 16, 2019

Notice: As of 2014 and for the forthcoming years, the publication frequency/periodicity of WSEAS Journals is adapted to the 'continuously updated' model. What this means is that instead of being separated into issues, new papers will be added on a continuous basis, allowing a more regular flow and shorter publication times. The papers will appear in reverse order, therefore the most recent one will be on top.

Volume 16, 2019


The Associations Between Earnings Management, Corporate Environmental Disclosure, Corporate Financial Performance and Corporate Governance Mechanisms

AUTHORS: St. Dwiarso Utomo, Zaky Machmuddah, Melati Oktafiyani

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ABSTRACT: The aim of the study is to investigate the associations between earnings management (DA), corporate environmental disclosure (CED), corporate financial performance (CFP), and corporate governance (CG) mechanisms. Using Partial Least Squares-Structural Equation Modelling (SEM), the study obtains empirical findings consistent with all hypotheses. DA has a positive effect on both CED and CFP; CED has a positive effect on CFP; and CG partially mediates the effect of DA on CFP. CG, as measured by institutional ownership and the number of audit committees, weakens the association between DA and CFP. However, CG, as measured by the proportion of independent commissioners, is not able to weaken the association of DA and CFP. Therefore, CG does not fully moderate the relationship between DA and CFP. It is recommended that control variables be used in order to clarify the effect of latent variables in future studies.

KEYWORDS: Earnings management, corporate environmental disclosure, corporate financial performance, and corporate governance mechanism.

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WSEAS Transactions on Business and Economics, ISSN / E-ISSN: 1109-9526 / 2224-2899, Volume 16, 2019, Art. #39, pp. 345-354


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