Independent and joint effects of carbon performance and family ownership on financial reporting quality
DOI: https://doi.org/10.3846/btp.2026.22183Abstract
This study examines the individual and joint impact of carbon emission disclosure and family ownership on audit report lag using data from 124 non-financial firms listed on the Indonesia Stock Exchange (IDX) from 2017 to 2019. Findings show that greater carbon emission disclosure reduces audit report lag, leading to higher financial reporting quality. Conversely, family-controlled firms tend to have longer audit report lag, as external auditors perceive them as having higher audit risks. The interaction between carbon performance and family ownership also contributes to delays in audit reporting. Additionally, family members in supervisory roles lead to increased audit report timeliness, negatively impacting financial reporting quality. Next, the effects of carbon performance and family firms on audit report lag remain statistically significant for companies in high-profile industries. Furthermore, analysis of endogeneity confirms the credibility of the factors influencing audit report lag. The study highlights the importance of carbon disclosure in environmental and financial reporting, while family-owned businesses may struggle with audit deadlines due to their unique characteristics. Recognizing these obstacles can help auditors and regulators tailor their approaches when auditing family-owned enterprises to ensure timely reporting. This research contributes to the literature by exploring the relationship between carbon disclosure, family ownership, and audit report completion time, emphasizing the need to integrate environmental factors into financial reporting practices.
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carbon emission disclosure, family ownership, financial reporting quality, IndonesiaHow to Cite
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