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Optimization of Monetary Corporate Social Responsibility Value Added in Reducing Financial Distress in Indonesia

Author

Listed:
  • Nila Tristiarini

    (Faculty of Economics and Business, Dian Nuswantoro University, Semarang, Indonesia,)

  • Yulita Setiawanta

    (Faculty of Economics and Business, Dian Nuswantoro University, Semarang, Indonesia,)

  • Ririh Dian Pratiwi

    (Faculty of Economics and Business, Dian Nuswantoro University, Semarang, Indonesia)

Abstract

This study tried to investigate about a form of solution model and new empirical evidence which is not only related to how the effect of the application of corporate social responsibility (CSR) to improve financial performance (FP) but also the measurement of benefits and costs of CSR activities as corporate strategy that allows to reduce financial distress so as to improve the FP of the company. The study sample was the whole companies which are included in the SRI-KEHATI index in 2009-2015, a total sample of 175 companies. This study used analysis tools structural equation modeling with a 3.00 version WarpPLS program to test the hypothesis. Outcomes of this research is that company can determine the optimization of CSR in terms of benefits and costs so that it can be used as a strategy for policy making in implementing CSR activities that can have positive implications on the sustainability of the company.

Suggested Citation

  • Nila Tristiarini & Yulita Setiawanta & Ririh Dian Pratiwi, 2017. "Optimization of Monetary Corporate Social Responsibility Value Added in Reducing Financial Distress in Indonesia," International Journal of Economics and Financial Issues, Econjournals, vol. 7(2), pages 500-506.
    • Handle: RePEc:eco:journ1:2017-02-65
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    Citations

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    Cited by:

    1. Mochammad Chabachib & Ike Setyaningrum & Hersugondo Hersugondo & Intan Shaferi & Imang Dapit Pamungkas, 2020. "Does Financial Performance Matter? Evidence on the Impact of Liquidity and Firm Size on Stock Return in Indonesia," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(4), pages 546-555, July.
    2. Yin Shi & Xiaoni Li & Maher Asal, 2023. "Impact of sustainability on financial distress in the air transport industry: the moderating effect of Asia–Pacific," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-23, December.

    More about this item

    Keywords

    Corporate Social Responsibility; Financial Distress Reduction; Financial Performance; Financial Risk Management;
    All these keywords.

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • G3 - Financial Economics - - Corporate Finance and Governance
    • M4 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting

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