Effect of ESG Disclosure and Intellectual Capital on Earnings Persistence: Evidence from Indonesia

Wana Wijaya, Linda Kusumaning Wedari

Abstract

Earnings persistence as one of the important attributes of accounting earnings shows how future earnings will be sustained, thus, it reflects good performance of the company. This research focuses on the factors that determine earnings persistence. This study investigates the effect of ESG disclosure and intellectual capital on earnings persistence in high-pollution industries in Indonesia. By analyzing 18 companies listed on the Indonesia Stock Exchange during the period 2018-2021, the findings support that ESG disclosure and intellectual capital impact earnings persistence. This research used panel data and Stata software to process and analyze the data. The model used in this study is multiple linear regression analysis. The findings of this study are that ESG disclosure and intellectual capital brought competitive advantage to the companies. These findings are important for companies and regulators to be more attentive to detailed ESG information application and intellectual capital disclosure. This study contributes to the literature on non-financial variables and earnings persistence. Future research may be conducted in other countries to confirm possible factors having a relationship with earnings persistence, since the arch country may have particular characteristics.

 

Keywords: earnings persistence, intellectual capital, ESG disclosure.

 

DOI: https://doi.org/10.55463/hkjss.issn.1021-3619.61.43


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