ESG Part, Financial Distress, Financial Fraud and Audit Committee as a Moderating Variable
DOI:
https://doi.org/10.56127/ijml.v5i2.2689Keywords:
ESG, Financial Distress, Financial Reporting Fraud, Audit CommitteeAbstract
This research is motivated by the increasing demands for transparency and accountability. Companies are not only required to present reliable financial reports but also to demonstrate their commitment to sustainability practices through ESG performance. On the other hand, financial distress can increase pressure on management to maintain company performance, potentially encouraging financial statement manipulation. The audit committee acts as an oversight mechanism that can improve the integrity of the financial reporting process. This study aims to analyze the effect of ESG performance and financial distress on financial statement fraud and to examine the moderating role of the audit committee in this relationship by considering differences in industry characteristics as a control variable. This study uses a quantitative approach with secondary data from 94 companies in the ASEAN region for the period 2017–2024 with a total of 752 observations. Data analysis was performed using panel data regression with the help of Eviews 14 software. The results show that ESG performance and financial distress have a significant effect on financial statement fraud. The results of the moderation test indicate that the audit committee is able to moderate the relationship between ESG and financial distress on financial statement fraud. Differences in industry sector characteristics can affect the level of ESG, the risk of financial distress, and the effectiveness of audit committee oversight in preventing financial statement fraud. These findings suggest that increasing corporate transparency depends not only on ESG but also on considering industry sector characteristics and adapting oversight strategies to minimize the potential for financial reporting fraud in the ASEAN region.
References
ACFE. (2024). Association of Certified Fraud Examiners The Nations Occupational Fraud 2024 :A Report To The Nations. Association of Certified Fraud Examiners, 1–106.
Agustini, Y. et al. (2023). Pengaruh Environment, Social, and Governance, dan Financial Distress terhadap Tax Aggressiveness di Indonesia: CEO Gender sebagai Variabel Moderasi. Jurnal Informatika Ekonomi Bisnis, 5(3), 920–926. https://doi.org/10.37034/infeb.v5i3.670
Al-Hadrami, A. et al. (2020). The impact of an audit committee’s independence and competence on investment decision: a study in Bahrain. Asian Journal of Accounting Research, 5(2), 299–313. https://doi.org/10.1108/AJAR-02-2020-0008
Altman, E. I. (1968). Financial ratios, discriminant analysis and the prediction of corporate bankruptcy. The Journal of Finance, 23(4), 589–609. https://doi.org/https://doi.org/10.1111/j.1540-6261.1968.tb00843
Amalia, J. R. et al. (2025). Pengaruh Fraud Hexagon dan Financial Distress Dengan Komite Audit Sebagai Moderasi Terhadap Kecurangan Laporan Keuangan Sektor Infrastruktur Bursa Efek Indonesia. Jurnal Greenation Ilmu Akuntansi, 3(1), 22–40. https://doi.org/10.38035/jgia.v3i1.158
Amalia, R., & Kusuma, I. W. (2023). Pengaruh Kinerja Lingkungan, Sosial, Dan Tata Kelola Terhadap Kinerja Pasar Dengan Kontroversi Esg Sebagai Variabel Pemoderasi. ABIS: Accounting and Business Information Systems Journal, 11(2), 175–194. https://doi.org/10.22146/abis.v11i2.84771
Andriani, N., & Arsjah, R. J. (2022). Pengaruh Intellectual Capital Dan Esg Terhadap Manajemen Laba Yang Dimoderasi Oleh Profitabilitas. Jurnal Ekonomi Trisakti, 2(2), 595–610. https://doi.org/10.25105/jet.v2i2.14646
Anjani, M. D. D. et al. (2024). Pengaruh Struktur Kepemilikan, Karakteristik Komite Audit dan Green Innovation terhadap ESG Disclosure dengan Ukuran Dewan Komisaris Sebagai Pemoderasi. Ekuitas: Jurnal Pendidikan Ekonomi, 12(2), 341–356. https://doi.org/10.23887/ekuitas.v12i2.87649
Asni, N., & Heniwati, E. (2023). Moderasi Komite Audit Pada Determinan Kecurangan Laporan Keuangan. Abdi Equator Accounting Based on Data and Infotmation, 2(2), 48–58. https://doi.org/10.26418/abdiequator.v2i2.64178
Aydoğmuş, M. et al. (2022). Impact of ESG performance on firm value and profitability. Borsa Istanbul Review, 22(2), S119–S127. https://doi.org/10.1016/j.bir.2022.11.006
Azis, F., & Annisa, D. (2023). Pengaruh Financial Distress Dan Audit Tenure Terhadap Integritas Laporan Keuangan Dengan Komite Audit Sebagai Variabel Pemoderasi. Determinant of Financial Report Integrity, 11(2), 01–10. https://doi.org/10.37641/jiakes.v11i2.1626
Fuadah, L. L. et al. (2022). The Ownership Structure, and the Environmental, Social, and Governance (ESG) Disclosure, Firm Value and Firm Performance: The Audit Committee as Moderating Variable. Economies, 10(12), 1–16. https://doi.org/10.3390/economies10120314
Ghozali, I. (2021). Aplikasi Analisis Multivariate dengan Program IBM SPSS 26 Edisi 10 (10th ed.). Badan Penerbit Universitas Diponegoro. https://doi.org/yahoogroup.com/group/Multivartiate_SEM
Haddad, A. et al. (2022). The effect of audit committee quality on the conventional and Islamic banks’ financial performance between subprime and Corona crises. Asian Journal of Accounting Research, 7(3), 230–251. https://doi.org/10.1108/AJAR-11-2020-0121
Hajek, P., & Munk, M. (2024). Corporate financial distress prediction using the risk-related information content of annual reports. Information Processing and Management, 61(5), 1–21. https://doi.org/10.1016/j.ipm.2024.103820
Handayani, F. D., & Annisa, D. (2024). Pengaruh komite audit, financial distress dan komisaris independen terhadap integritas laporan keuangan dengan whistleblowing sebagai pemoderasi. Journal of Law, Administration, and Social Science, 4(6), 1159–1167. https://doi.org/10.54957/jolas.v4i6.1042
Husnah, H. (2023). Integrating Environmental, Social and Governance (ESG) Disclosure on Financial Performance of Indonesian Mining Industry Sector. Jurnal Aplikasi Bisnis Dan Manajemen, 9(3), 763–773. https://doi.org/10.17358/jabm.9.3.763
Imelda, I. et al. (2025). Analyzing The Role Of The Audit Committee In Good Corporate Governance: Influence On Transparency And Accountability Of Financial Reports. Jurnal Akuntansi, 14(1), 73–87. https://doi.org/10.46806/ja.v14i1.1398 URL:
Kirana, M. et al. (2023). Apakah Teori Kecurangan Hexagon Efektif Mencegah Manipulasi Laporan Keuangan Perusahaan Bumn? Jurnal Akuntansi Multiparadigma, 14(1), 87–97. https://doi.org/10.21776/ub.jamal.2023.14.1.06
Kolin, L. I. et al. (2024). Kualitas Audit terhadap Kinerja Keuangan Perusahaan Bank yang Terdaftar di BEI Periode 2018-2022. Jurnal Ekonomi, Manajemen Dan Bisnis, 1(4), 1910–1918. https://doi.org/jurnalamanah.com/index.php/cakrawala/index
Laus, V. et al. (2025). Are deal premiums affected by ESG and financial distress? International Review of Economics and Finance, 102(April), 1–19. https://doi.org/10.1016/j.iref.2025.104401
Le, L. T. (2024). Impact of environmental, social and governance practices on financial performance: evidence from listed companies in Southeast Asia. Cogent Business and Management, 11(1), 1–17. https://doi.org/10.1080/23311975.2024.2379568
Liu, D., & Jin, S. (2023). How Does Corporate ESG Performance Affect Financial Irregularities? Sustainability, 15(13), 1–16. https://doi.org/RePEc:gam:jsusta:v:15:y:2023:i:13:p:9999-:d:1178173
Lokanan, M., & Sharma, S. (2024). The use of machine learning algorithms to predict financial statement fraud. British Accounting Review, 56(6), 1–24. https://doi.org/10.1016/j.bar.2024.101441
Manullang, A. K. et al. (2024). Pengaruh Pengungkapan Environmental, Social, and Governance (ESG) Terhadap Kinerja Keuangan dengan Komite Audit sebagai Pemoderasi (Studi empiris pada Perusahaan Manufaktur yang terdaftar dalam Bursa Efek Indonesia (2020-2022). Diponegoro Journal of Accounting, 13(4), 1–13. http://ejournal-s1.undip.ac.id/index.php/accounting
Meutia, I. et al. (2022). Stakeholder or Legitimacy Theory? The Rationale behind a Company’s Materiality Analysis: Evidence from Indonesia. Sustainability (Switzerland), 14(13), 1–20. https://doi.org/10.3390/su14137763
Mohammad, W. M. W., & Wasiuzzaman, S. (2021). Environmental, Social and Governance (ESG) disclosure, competitive advantage and performance of firms in Malaysia. Cleaner Environmental Systems, 2(2), 1–11. https://doi.org/10.1016/j.cesys.2021.100015
Mukhtaruddin, M. et al. (2018). Firm’s Characteristics, Corporate Governance Quality and Corporate Social Responsibility Disclosure. Sriwijaya International Journal of Dynamic Economics and Business, 2(3), 193–212. https://doi.org/10.29259/sijdeb.v2i3.193-212
Mukhtaruddin, M. et al. (2022). Financial distress , earning management , financial statement fraud and audit quality as a moderating variable : listed companies on the Indonesia Stock Exchange. F1000Research, 11(1), 1–18. https://doi.org/10.12688/f1000research.123525.1
Mukhtaruddin, M. et al. (2025). Asian Economic and Financial Review Environmental , social and governance , and tax avoidance : Study in ASEAN countries. Asian Economic and Financial Review, 15(6), 996–1010. https://doi.org/10.55493/5002.v15i6.5458
Nareswari, N. et al. (2023). Analysis of Environmental, Social, and Governance Performance in Indonesia: Role of ESG on Corporate Performance. Procedia Computer Science, 225(1), 1748–1756. https://doi.org/10.1016/j.procs.2023.10.164
Nejad, M. Y. et al. (2024). A panel data analysis of the effect of audit quality on financial statement fraud. Asian Journal of Accounting Research, 9(4), 422–445. https://doi.org/10.1108/AJAR-04-2023-0112
Novianty, F. et al. (2025). Pengaruh Komite Audit dan Ukuran Perusahaan Terhadap Integritas Laporan Keuangan PAda Perusahaan Badan Usaha Milik Negara (BUMN) Periode 2021-2024. Brainy, 6(1), 14–24. https://doi.org/10.37817/ikraith-ekonomika.v8i2.4315
Nugroho, N. A., & Hersugondo, H. (2022). Analisis Pengaruh Environmental , Social , Governance ( ESG ) Disclosure terhadap Kinerja Keuangan Perusahaan. JURNAL ILMIAH EKONOMI DAN BISNIS, 15(2), 233–243. https://doi.org/6journal.stekom.ac.id/index.php/E-Bisnis
Nugroho, S. D., & Diyanty, V. (2022). Hexagon Fraud in Fraudulent Financial Statements: the Moderating Role of Audit Committee. Jurnal Akuntansi Dan Keuangan Indonesia, 19(1), 46–67. https://doi.org/10.21002/jaki.2022.03
Putri, F. T., & Hariadi, B. (2023). Pengaruh Financial Distress Terhadap Kecurangan Laporan Keuangan Dengan Good Corporate Governance Sebagai Variabel Moderasi. Reviu Akuntansi, Keuangan, Dan Sistem Informasi, 2(3), 680–691. https://doi.org/repository.ub.ac.id/id/eprint/205041
Qurniasih, R. et al. (2025). Pengaruh Pengungkapan ESG Terhadap Nilai Perusahaan Dengan Praktik Good Corporate Governance Sebagai Variabel Moderasi. E-Jurnal Akuntansi, 35 (2), 301–319. https://doi.org/10.24843/EJA.2025.v35.i02.p01
Rachmadiansyah, I. A. et al. (2025). Peran Mediasi Pengungkapan Environmental, Social dan Governance Dalam Pengaruh Audit Committee dan Financial Performance Terhadap Nilai Perusahaan: Studi Pada Perusahaan BEI Database Thomson Reuters (2020-2022). Journal of Accounting and Finance Management, 6(1), 158–175. https://doi.org/10.38035/jafm.v6i1.1655
Riyanti, A. (2024). Komite Audit Sebagai Pemoderasi Pengaruh Kesulitan Keuangan Dan Manajemen Laba Terhadap Kecurangan Laporan Keuangan. Jurnal Akuntansi Dan Pajak, 24(02), 1–9. https://doi.org//index.php/jap/article/download/12345
Rosidi, R. et al. (2023). Apakah Audit Internal Berperan Dalam Pencegahan Korupsi? Jurnal Akuntansi Multiparadigma, 14(1), 138–148. https://doi.org/10.21776/ub.jamal.2023.14.1.10
Sadaa, A. M. et al. (2023). Corporate governance as antecedents and financial distress as a consequence of credit risk. Evidence from Iraqi banks. Journal of Open Innovation: Technology, Market, and Complexity, 9(2), 1–16. https://doi.org/10.1016/j.joitmc.2023.100051
Saftiana, Y. et al. (2023). The Influence of Accountability , Participation , and Transparency of Boss Funds on the Financial Performance of Public Elementary Schools in Palembang City. Jurnal Manajemen, Kepemimpinan, Dan Supervisi Pendidikan, 8(10), 329–343. https://doi.org/10.31851/jmksp.v10i2
Sakawa, H. et al. (2024). Do bank ties influence stock repurchases in a bank-based financial system during financial distress? A pre-registered report. Pacific Basin Finance Journal, 85(4), 1–11. https://doi.org/10.1016/j.pacfin.2024.102380
Samy El-Deeb, M. et al. (2023). Does audit quality moderate the impact of environmental, social and governance disclosure on firm value? Further evidence from Egypt. Journal of Humanities and Applied Social Sciences, 5(4), 293–322. https://doi.org/10.1108/jhass-11-2022-0155
Sari, H. G. I. et al. (2026). Kinerja ESG , Independensi Komite Audit , dan Biaya Modal : Bukti Moderasi dari Perusahaan Bursa Efek Indonesia. Owner: Riset & Jurnal Akuntansi, 10(2021), 259–271. https://doi.org/10.33395/owner.v10i1.3021
Sugiyono. (2022). Metode Penelitian Kuantitatif, Kualitatif dan R&D. Alfabeta.
Tahmid, T. et al. (2022). Does ESG initiatives yield greater firm value and performance? New evidence from European firms. Cogent Business and Management, 9(1), 1–16. https://doi.org/10.1080/23311975.2022.2144098
Umar, H. et al. (2024). Corruption prevention in organizational clustering in Indonesia: through the role of the HU-model in detecting corruption. Journal of Money Laundering Control, 27(7), 70–85. https://doi.org/10.1108/JMLC-10-2023-0163
Wang, Y., & Liu, S. (2025). Managerial short-termism , ESG performance , and corporate financial Fraud : A heterogeneity analysis based on corporate ownership. International Review of Economics and Finance, 102(7), 01–09. https://doi.org/10.1016/j.iref.2025.104385
Wijaya, D., & Kuang, T. M. (2023). Do Intellectual Capital and ESG Mitigate Accounting Fraud? Jurnal Akuntansi Multiparadigma, 14(2), 236–245. https://doi.org/10.21776/ub.jamal.2023.14.2.17
Xu, Y., & Zhu, N. (2024). The Effect of Environmental, Social, and Governance (ESG) Performance on Corporate Financial Performance in China: Based on the Perspective of Innovation and Financial Constraints. Sustainability (Switzerland), 16(8), 1–21. https://doi.org/10.3390/su16083329
Yudhanto, W., & Simamora, A. J. (2023). Environmental, Social, and Governance Risk on Firm Performance: The Mediating Role of Firm Risk. Binus Business Review, 14(2), 223–234. https://doi.org/10.21512/bbr.v14i2.8935
Downloads
Published
Issue
Section
Citation Check
License
Copyright (c) 2026 Imelda Imelda, Mukhtaruddin Mukhtaruddin, Kartasari F Shelly
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
