Why did Management Needs to Disclose Risk Information? A Study in Indonesia^s Food and Beverage Manufacturing Companies Tia Arfiani, Farida, Betari Maharani, Nur Hidayah
Universitas Muhammadiyah Magelang
Abstract
Risk disclosure provides high-quality information about the potential risks that occur in a company. This information is available for stakeholders to make a decision. This research aims to analyze the influence of financial performance (profitability and leverage) and good corporate governance (GCG) on risk disclosure in Food and beverage manufacturing companies listed on the Indonesia Stock Exchange (IDX) in 2016-2020. The 45 sampel size was selected through the purposive random sampling techniques. The multiple linear regression used to analyze and hypothesis testing. The results of the study revealed that GCG-managerial ownership, GCG-risk management committee, and GCG-public ownership encourage companies^ tendency to disclose risks. In addition, high profitability diminishes companies^ tendency to disclose risks. Meanwhile, leverage and GCG-auditor reputation have no impact on risk disclosure. This research is expected to be able to improve the quality of both financial and non-financial information to provide accurate information to stakeholders in making the right decisions
Keywords: Risk Disclosure- Financial Performance- Good Corporate Governance
