The Mediation Role of Sustainability Reporting Disclosure on Financial Performance and Firm Value

High levels of profitability and leverage can drive corporations to engage and disclose more broadly social responsibility activities in order to improve their company's reputation and image of stakeholders. The quality of sustainability reporting is expected to give stakeholders a positive corporate image and increase company value. Thus, if the company pays attention to the economic, social, and environmental dimensions, the company's value will be guaranteed to grow in a sustainable manner, because sustainability is a balance of economic, environmental, and community interests. The purpose of this study is to investigate the relationship between financial performance and firm value using sustainability reporting as a moderating variable. Financial performance, consist of profitability as measured by ROA and leverage as measured by DER. Tobin's Q is used to calculate firm value. Meanwhile, the GRI G4 index is used to calculate sustainability reporting disclosure. The companies listed on the Asia Sustainability Reporting Rating (ASRRAT) 2016-2020 are the focus of this study. Sustainability reports, annual reports, and financial statements were used as data sources. Purposive sampling was used for data collection, and the method of data analysis was the Partial Least Squares (PLS) test.