Quality of sustainability reporting: how is the role of foreign institutional ownership and political connections?

• Elva Nuraina Faculty of Teacher Training and Education, Accounting Education Departement at Universitas PGRI Madiun, Indonesia, Student of the Doctoral Program in Accounting, Universitas Airlangga, Indonesia
• I Made Narsa Faculty of Economics and Business Universitas Airlangga, Indonesia

Palabras clave: Foreign institutional ownership, quality of sustainability reporting, political connections.

Resumen

This study aims to investigate the relationship between foreign institutional ownership and the quality of sustainability reporting as a function of political connections. The research sample consists of 485 companies listed on the Indonesian Stock Exchange. The analysis technique used is Generalized Method of Moments (GMM). The results showed that political connections weakened the relationship of foreign institutional ownership and the quality of sustainability reporting. This indicates that higher political connections cause companies to sharply avoid quality sustainability reporting, because sustainability reporting requires their full transparency and disclosure.