THE INFORMATION ASYMMETRY AND CORPORATE SOCIAL RESPONSIBILITY DISCLOSURE

CSR become one of the highlighted activities, aligned with the requirement to adopt the interest
of stakeholders. This study aims to search whether the earnestness of companies to manage
CSR as disclosed in their sustainability reporting reduces information asymmetry. The sample
consists of the companies that have published sustainability reporting for the period 2008-2014
and listed in Indonesia Stock Exchange. The finding of this research are as follow: (1) unlike the
previous research that found a reducing of information asymmetry after the issuing of
sustainability reporting, this study finds the opposite, that the higher the disclosure of CSR
activities, the wider the spread, (2) further, this study finds that the companies which have a
negative earning tend to disclose more CSR information (3) The presence of institutional
investors representing well-informed investors help the company to ensure the reliability of CSR
activity information delivered through Sustainability Reporting.