Firm Characteristics and Disclosures of Materiality Assessment in Sustainability Reporting

This study examinesthe relevance of financial performance, leverage, corporate governance, and firmsize in determining the levelof materiality assessment disclosure in sustainability reports. The analysis, which focuses on 177 listed companyin Indonesia from 2020 to 2022, resulting in 531 observations, reveals several important findings. The disclosure of materiality assessmentin sustainability reports serves as the dependent variable, while the independent factors include firm performance (measured by book and market performance), corporate governance (represented by the audit committee and independent commissioners), firmleverage, and firmsize. The study employs ordinal logistic regression to test the data. The empirical findings, which show that the level of disclosure in materiality evaluation is highly influenced by firm performance, audit committee, and firm size, but not by leverage and independent commissioners, have significant implications for businesses and regulators in Indonesia. Theyoffer a relevant perspective on the aspects that can enhancethe quality of sustainability reporting procedures, promote transparency and accountability, and engage the academic and professional communities in the field.