WAHYUDI, Sugeng (2018) STRATEGY TO IMPROVE FIRM PERFORMANCE THROUGH OPERATIONAL EFFICIENCY COMMITMENT TO ENVIRON­ MENTAL FRIENDLINESS: EVIDENCE FROM INDONESIA. ORGANIZATIONS AND MARKETS IN EMERGING ECONOMIES, 2018, 9 (1). ISSN Online ISSN 2345-0037

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Abstract

The objective of this study is to examine the effect of controlling shareholders’ monitoring on
firm performance through the implementation of operational efficiency commitment to environmental
friendliness. Non-financial firms listed on the Indonesia Stock Exchange and joining the Environmental
Performance Assessment Program (PROPER) are determined as the sample. Results indicate that
controlling shareholders have a positive impact on operational efficiency commitment to environmental
friendliness and also on firm performance. In addition, other key findings indicate that the controlling
shareholders can improve firm performance through the implementation of operational efficiency commitment
to environmental friendliness. The results of this study support the position of the agency theory, the stakeholder theory, and the legitimacy theory. Operational efficiency commitment to environmental friendliness is then suggested to be a meaningful strategy for the firms to obtain sustainable performance.

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