The Effect of Tax Avoidance, Environmental Performance, and Institutional Ownership on Firm Value with Profitability as a Moderator

Abstract

This study analyses the factors affecting firm value in the extractive sector listed on the Indonesia Stock Exchange (IDX) during the 2020-2024 period, focusing on tax avoidance, environmental performance, and profitability as a moderating variable. Using purposive sampling, 37 companies were selected, resulting in 185 observations. Secondary data, including financial reports and PROPER ratings, were analysed using partial least squares-based structural equation modelling (PLS-SEM). The novelty of this research lies in integrating financial factors (tax avoidance and profitability) and environmental factors (environmental performance) into a single analytical model. The findings reveal that tax avoidance has no effect on firm value, suggesting investors do not prioritize tax strategies. In contrast, environmental performance has a significant negative effect, possibly due to concerns that environmental investments have not yet yielded sufficient financial returns. Profitability has a significant positive effect on firm value. Furthermore, profitability does not moderate the relationship between tax avoidance and firm value but significantly moderates the negative effect of environmental performance on firm value. This implies that highly profitable companies are better positioned to absorb environmental costs without significantly reducing their firm value, achieving a balance between environmental responsibility and value creation.

Abstrak - Penelitian ini menganalisis faktor-faktor yang memengaruhi nilai perusahaan di sektor ekstraktif pada Bursa Efek Indonesia (BEI) periode 2020-2024, dengan fokus pada tax avoidance, kinerja lingkungan, dan profitabilitas sebagai variabel moderasi. Sebanyak 37 perusahaan dipilih melalui metode purposive sampling, menghasilkan 185 observasi. Data sekunder, seperti laporan keuangan dan peringkat PROPER, dianalisis menggunakan structural equation modeling (SEM) berbasis partial least squares (PLS-SEM). Kebaruan penelitian ini terletak pada integrasi faktor finansial (tax avoidance dan profitabilitas) dan faktor lingkungan (kinerja lingkungan) dalam satu model analisis, yang memperdalam pemahaman tentang bagaimana perusahaan sektor ekstraktif mengelola strategi keuangan dan tanggung jawab lingkungan secara bersamaan. Hasil penelitian menunjukkan bahwa tax avoidance tidak berpengaruh terhadap nilai perusahaan, menunjukkan bahwa investor kurang memprioritaskan strategi pajak. Sebaliknya, kinerja lingkungan berpengaruh negatif signifikan terhadap nilai perusahaan karena kekhawatiran biaya lingkungan belum sebanding dengan manfaat finansial. Profitabilitas berpengaruh positif signifikan terhadap nilai perusahaan. Selain itu, profitabilitas tidak memoderasi hubungan antara tax avoidance dan nilai perusahaan, namun secara signifikan memoderasi pengaruh negatif kinerja lingkungan terhadap nilai perusahaan. Artinya, perusahaan dengan profitabilitas tinggi lebih mampu menyerap biaya lingkungan tanpa mengurangi nilai perusahaan secara drastis.