Bi-directional in sustainability reporting and profitability: A study in Indonesian banks and non-banks

Tri Gunarsih (Department of Management, Faculty of Business, Psychology and Communication, Universitas Teknologi Yogyakarta, Siliwangi Street, North Ring Road, Sleman, 55285)
Setiyono Setiyono (Department of Management, Faculty of Business, Psychology and Communication, Universitas Teknologi Yogyakarta, Siliwangi Street, North Ring Road, Sleman, 55285)
Fran Sayekti (Department of Accounting, Faculty of Business, Psychology and Communication, Universitas Teknologi Yogyakarta, Siliwangi Street, North Ring Road, Sleman, 55285)
Tamas Novak (Budapest Business School, H-1051 Budapest, Marko Street 29-31)

Jurnal Keuangan dan Perbankan
Vol 24, No 1 (2020): January 2020

We investigate the sustainability reporting differences in banks and non-banks sample firms and investigates reserve causality between sustainability reporting and profitability. The independent-sample t-test implemented to analyze the differences. The results report evidence that there are differences in sustainability reporting between the banks and non-bank. The average score of the sustainability reporting index in banks is higher than non-bank. The multiple regressions implemented in reserve causality between sustainability reporting and profitability. The empirical evidence shows that there is a negative relationship between sustainability reporting and profitability. We suggest that sustainability is merely a cost. The bi-directional relationship emerges in the economic and social dimension of sustainability reporting index. This result indicates that sustainability reporting influences firm performance and vice versa.JEL Classification: G21, G30 How to Cite:Gunarsih, T., Setiyono, Sayekti, F., Novak, T. (2020). Bi-directional insustainability reporting and profitability: A study in Indonesian banks and non-banks. Jurnal Keuangan dan Perbankan, 24(1), 20-29.DOI: https://doi.org/10.26905/jkdp.v24i1.3588