Nexus Among Debt, Profit, and Sustainability: Evidence from Indonesian Hotels
Abstract
This study aims to analyze the relationship between: 1) liquidity and sustainability report (SR) disclosure; 2) SR disclosure and profitability; and 3) liquidity and profitability. This quantitative study is the first study to analyze the interaction among these three variables in the context of Indonesian hotel companies. Samples involved are companies that are listed in hotel, resort, and cruise industrial classification of Indonesia Stock Exchange (IDX) in 2021-2023 period. Data analysis is done using Partial Least Squares-Structural Equation Modeling (PLS-SEM). The result shows that SR disclosure positively and significantly affects profitability. This finding supports the anticipation theory which states that there are benefits of anticipating action. Anticipation of sustainability would allow hotel companies to have lower costs related to future environmental-related regulations so that hotels can maintain more stable cash flow compared to companies who have not adapted the regulation at the current year. This finding also supports theory of corporate social responsibility (CSR) which views sustainability actions as “product” for customers and investors. These products exploit both existing and new markets and send signals of environmentally-aware perception to investors who would value the company higher. On the other hand, liquidity fails to positively affects both SR disclosure and profitability.
Keywords:
disclosure, hotel, liquidity, profitability, sustainability
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Agung, C. P., Inawati, W. A., & Anggita, M. (2024). Hotel Revenue Performance: Roles of Labor, Liquidity, and Governance Mechanism. Jurnal Ekonomi & Ekonomi Syariah, 7(2). https://doi.org/10.36778/jesya.v7i2.1615
American Hotel & Lodging Association. (2014). Uniform System of Accounts for the Lodging Industry. The Educational Institute of the American Hotel & Motel Association.
ARUP. (2024). Transforming Existing Hotels to Net Zero Carbon.
Azzahra, D. S., Pratama, B. C., Fakhruddin, I., & Mudjiyanti, R. (2021). Pengaruh Penerapan Green Accounting, Karakteristik Komite Audit, Diversitas Kebangsaan Direksi dan Gender Direksi terhadap Pengungkapan Corporate Social Responsibility di Perbankan. Jurnal Akuntansi Dan Pajak, 2(2).
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Brigham, E. F., & Houston, J. F. (2007). Essentials of Financial Management. Cengage Learning Asia Pte Ltd.
Buallay, A. (2019). Is sustainability reporting (ESG) associated with performance? Evidence from the European banking sector. Management of Environmental Quality: An International Journal, 30(1), 98–115. https://doi.org/10.1108/MEQ-12-2017-0149
Buallay, A. (2022). Sustainability reporting in food industry: an innovative tool for enhancing financial performance. British Food Journal, 124(6), 1939–1958. https://doi.org/10.1108/BFJ-01-2021-0053
Cahyani, R. A., & Sitohang, S. (2020). Pengaruh Perputaran Modal Kerja, Likuiditas, dan Solvabilitas terhadap Profitabilitas. Jurnal Ilmu Dan Riset Manajemen, 9(6), 1–17.
Four Seasons. (2022). Four Seasons for Good: 2022 Environmental, Social, and Governance (ESG) Report.
Gabarda-Mallorquí, A., Garcia, X., & Ribas, A. (2017). Mass tourism and water efficiency in the hotel industry: A case study. International Journal of Hospitality Management, 61, 82–93. https://doi.org/10.1016/j.ijhm.2016.11.006
Guilding, C. (2014). Accounting Essentials for Hospitality Managers. Routledge.
Henseler, J., Ringle, C. M., & Sinkovics, R. R. (2009). The use of partial least squares path modeling in international marketing. Advances in International Marketing, 20, 277–319. https://doi.org/10.1108/S1474-7979(2009)0000020014
Jiang, J. (2023). Application of Dupont-factor analysis to financial performance and market measurement of the southeast Asian hotel industry. International Journal of Applied Economics, Finance and Accounting, 17(1), 127–134. https://doi.org/10.33094/ijaefa.v17i1.1089
Khaveh, A., Rajab Nikhashemi, S., Yousefi, A., & Haque, A. (2021). Voluntary Sustainability Disclosure, Revenue, and Shareholders Wealth-A Perspective from Singaporean Companies. Business Management Dynamics, 1(9), 6–12. http://ssrn.com/abstract=2071275Electroniccopyavailableat:http://ssrn.com/abstract=2071275
Kularatne, T., Wilson, C., Månsson, J., Hoang, V., & Lee, B. (2019). Do environmentally sustainable practices make hotels more efficient? A study of major hotels in Sri Lanka. Tourism Management, 71, 213–225. https://doi.org/10.1016/j.tourman.2018.09.009
Laskar, N. (2019). Does Sustainability Reporting Enhance Firms Profitability? A Study on Select Companies from India and South Korea. Indian Journal of Corporate Governance, 12(1), 2–20. https://doi.org/10.1177/0974686219836528
Levy, S. E., & Park, S. Y. (2011). An analysis of CSR activities in the lodging industry. Journal of Hospitality and Tourism Management, 18(1), 147–154. https://doi.org/10.1375/jhtm.18.1.147
Malik, M. S., Awais, M., & Khursheed, A. (2016). Impact of Liquidity on Profitability: A Comprehensive Case of Pakistan’s Private Banking Sector. International Journal of Economics and Finance, 8(3), 69. https://doi.org/10.5539/ijef.v8n3p69
Melián-González, S., & Bulchand-Gidumal, J. (2020). Employment in tourism: The jaws of the snake in the hotel industry. Tourism Management, 80. https://doi.org/10.1016/j.tourman.2020.104123
Minh, N. H., Thu Ha, N., Chi Anh, P., & Matsui, Y. (2015). Service quality and customer satisfaction: A case study of hotel industry in Vietnam. Asian Social Science, 11(10), 73–85. https://doi.org/10.5539/ass.v11n10p73
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Nugroho, P. I., & Arjowo, I. S. (2014). The Effects of Sustainability Report Disclosure Towards Financial Performance. International Journal of Business and Management Studies, 3(3), 225–239.
Nurdiana, D. (2018). Pengaruh Ukuran Perusahaan Dan Likuiditas Terhadap Profitabilitas. Menara Ilmu, XII(6), 77–88.
Pandapotan, J., & Lastiningsih, N. (2020). The Effect of Capital Structure, Liquidity, and Company Size towards Profitability. Journal of Economics and Behavioral Studies, 12(4), 59–66.
Regulation of Indonesia Financial Services No 51 /POJK.03/2017 (2017).
Sinaga, I., & Teddyani, S. (2020). Faktor-Faktor Pengungkapan Sustainability Report. ECo-Fin, 2(2), 1–12.
Styles, D., Schoenberger, H., & Galvez-Martos, J. L. (2015). Water management in the European hospitality sector: Best practice, performance benchmarks and improvement potential. Tourism Management, 46, 187–202. https://doi.org/10.1016/j.tourman.2014.07.005
Sundas, S., & Butt, M. (2021). Impact of Liquidity on Profitability and Performance: A Case of Textile Sector of Pakistan. International Journal of Commerce and Finance, 7(1), 122–129.
Syarli, Z. A. (2021). Pengaruh Leverage, Likuiditas, Profitabilitas, Ukuran Perusahaan, Umur Perusahaan, dan Kualitas Audit Terhadap Kualitas Laporan Keuangan Perusahaan. Bussman Journal : Indonesian Journal of Business and Management, 1(3), 314–327. https://doi.org/10.53363/buss.v1i3.10
Tahmid, T., Hoque, M. N., Said, J., Saona, P., & Azad, M. A. K. (2022). Does ESG initiatives yield greater firm value and performance? New evidence from European firms. Cogent Business and Management, 9(1). https://doi.org/10.1080/23311975.2022.2144098
Were, S. O., & Maranga, V. N. (2022). Hotel facilities’ management practices and employee performance in Kenya. Research in Hospitality Management, 12(2), 125–131. https://doi.org/10.1080/22243534.2022.2133069
Wicaksono, R. R., & Septiani, A. (2020). Determinan Sustainability Report dan Pengaruh terhadap Nilai Perusahaan. Diponegoro Journal Of Accounting, 9(2). http://ejournal-s1.undip.ac.id/index.php/accounting
Published
2025-01-03
How to Cite
Agung, C., Inawati, W., & Debby, T. (2025). Nexus Among Debt, Profit, and Sustainability: Evidence from Indonesian Hotels. Jesya (Jurnal Ekonomi Dan Ekonomi Syariah), 8(1), 190-198. https://doi.org/https://doi.org/10.36778/jesya.v8i1.1794
Section
Articles
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