How Integrated Reporting Amplifies Capital Intensity to Drive Firm Value Growth?

Abstract

Firm value reflects performance and competitiveness, which are the main
concerns for investors, especially in the consumer cyclicals sector which is
sensitive to economic cycles. Inconsistencies in previous research on how
working capital management and capital intensity affect firm value call for
further investigation. Panel data from 83 companies selected by purposive
sampling during the period 2021-2023 is used in this study. The analysis
employs a moderation regression method using EViews software. The
results show that capital intensity intensiveness is significantly positively
related to firm value, while working capital management is not. Integrated
reporting doesn't moderate the effect of working capital management on
firm value, but it strengthens the relationship between capital intensity
and firm value. These findings highlight the importance of investment in
fixed assets and reporting transparency to increase firm value. This study
provides insights for managers on leveraging integrated reporting in
creating sustainable firm value.