Risk and Return and Evidence of Information Disclosure Signals Public Company in Indonesia

Abstract

Disclosure of information to the public by the company is a signal or information for related parties. The purpose of this study is to analyze the effect of risk and return on public companies in Indonesia on information disclosure and firm value. Information disclosure by companies is related to good governance and corporate social responsibility obligations. The research period is before, during and after the COVID-19 pandemic, namely 2017-2021 with a sample of 45 companies so that the total data is 225 observations. Structural Equation Modeling – Partial Least Square (SEM-PLS) was used as a data analysis tool in this study.The results of data analysis show that if the risk is high, it will produce a high return as well. Companies need to pay attention to income before interest and taxes because it determines the level of risk that arises. The audit committee indicator is the best for assessing the Good Corporate Governance of public companies in Indonesia. Risk has a significant effect on the unidirectional relationship to Good Corporate Governance, while return has no significant effect on Good Corporate Governance. Risk has a significant effect on the unidirectional relationship to Corporate Social Responsibility, while return has no significant effect on Corporate Social Responsibility. Good Corporate Governance and Corporate Social Responsibility have a significant effect on the unidirectional relationship to the value of public companies in Indonesia. All stakeholders need to pay attention to risk factors in disclosing information that gives a positive signal to investors.