Sustainability Reporting Analysis on Cumulative Abnormal Returns Through Political Connections

Abstract

This study aims to analyze the effect of sustainability reports on cumulative abnormal return (CAR) with political connection as a mediating variable in mining companies listed on the Indonesia Stock Exchange during 2021–2024. The study is motivated by investors’ increasing attention to non-financial information, particularly sustainability disclosures, and the importance of political connections in the highly regulated mining industry. This research uses a quantitative approach with secondary data obtained from annual reports, sustainability reports, and capital market data. The population consists of 47 mining companies, while the sample includes 42 companies selected through purposive sampling, resulting in 168 samples. Data were analyzed using descriptive statistics, classical assumption tests, linear regression, and path analysis with SPSS version 25. The results indicate that sustainability reports positively affect political connection and cumulative abnormal return. Political connection also positively affects cumulative abnormal return and mediates relationship between sustainability reports and cumulative abnormal return.