Idrianita Anis¹, Ancella A.Hermawan^2
1Trisakti University, Jakarta, Indonesia
²University of Indonesia – Depok, Indonesia

ABSTRACT

This research aimed to examine the effect of corporate social responsibility disclosure (CSRD) and corporate governance mechanisms (CGM) on earnings management (EM) and stock risk (SRISK). The examination was conducted from the context of mandatory adoption of IAS-PSAK 50&55 (Revised 2006) and macroprudential policy in 2010. This study used the data of 36 banks, with 131 bank-years samples that were listed on IDX for the years 2008-2013. The results concluded that: (1a) CSRD has weak negative effect on SRIS; (1b) CGM has partial negative effect on SRISK, whereby BCM has no significant effect on SRISK, while ACM has significant negative effect on SRISK; (2a) CSRD has significant negative effect on E; (2b) CGM has partially negative effect on EM, whereby BCM has no significant effect on EM, while ACM has significant negative effect on EM; and (3) EM has positive significant effect on SRISK. Results 2 and 3 leads to the conclusion that direct effect of CSRD on SRISK was explained by indirect effect through EM. The overall result showed CSRD and CGM have negative effect on EM, though there are no significant decrease of EM at post period mandatory adoption of PSAK 50 and 55, yet the evidence found significant lower SRISK at post period of mandatory adoption of PSAK 50&55 (Revised 2006) and macroprudential policy.

Keywords: corporate social responsibility, corporate social responsibility disclosure, earnings management, corporate governance mechanisms, stock risk.