The effect of profitability and leverage on company value with carbon emissions disclosure as a mediator in carbon incentive companies in the LQ45 index

Abstract

This study aims to analyze the effect of profitability and leverage on company value with carbon emissions disclosure as a mediating variable in carbon-incentive companies listed on the LQ45 Index for the period 2020–2023. The research method uses a quantitative approach with secondary data and purposive sampling techniques. The analysis was conducted using regression tests to test the hypotheses. The results show that profitability has a positive effect on company value, leverage has a negative effect on company value, and carbon emissions disclosure has a significant effect on company value. In addition, carbon emissions disclosure is proven to mediate the relationship between profitability and leverage on company value. These findings confirm that financial and non-financial aspects, particularly carbon emissions disclosure, play an important role in increasing company value in the eyes of investors. The implication of this study is that companies need to increase profitability and maintain proportional leverage, as well as disclose carbon emissions transparently as a form of social and environmental responsibility to increase company value. For investors, these three aspects can be important indicators in assessing a company's prospects. For the government and regulators, these results encourage the need for more transparent emissions reporting policies.