Do board characteristics moderate the relationship between integrated reporting disclosure and company value?

Abstract

This study aims to examine the moderating role of board characteristics in the relationship between integrated reporting disclosure (IRD) and company value from the perspectives of agency and signaling theories. The analysis uses WarpPLS version 7.0 with 150 samples of manufacturing companies that are listed on the Indonesia Stock Exchange and provide IRD. Results indicate that IRD influences company value, meanwhile, board characteristics, which are proxied by board size, board independence, and board gender diversity, enhance the IRD influence on company value. However, board activity does not moderate IRD and company value. These findings imply the importance of the roles of board characteristics in strengthening IRD which can be used as a signal for companies to reduce information asymmetry by companies in influencing investor decision making and reducing agency costs, which, in turn, can increase company value. This research prompts companies about the importance of IRD in increasing company value and regulators regarding the development of policies related to IRD in Indonesia.