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We run the data using Mann–Whitney U-tests because the data is not normally distributed and the data consists of two
independent samples. From the test statistics result table, it can be seen that the value of asymp.sig (2-tailed) or p-value
is 0.092 (p-value 1-tailed is 0.046). Whereas α= 0,05. So, it can be concluded that there is a significant SKI difference
between firms with SO and without SO. From the ranks table, it can be seen that the mean of SKI in ISOE with SO is
higher than the SKI in ISOE without SO. Therefore, ISOEs which employ Sustainability Officer is likely to be included in
the SRI Kehati Index.

Giving the fact that most of the SO hired by the ISOE are on the middle management level, their relation to SKI is
surprising. Arora & Subramanian (2017) revealed that it is the top management team (TMT) of an organization
who have a strong influence in company’s strategic decision–making so that they can affect financial performance.
Furthermore, Peters, Romi, & Sanchez (2017) revealed that the Chief Sustainability Officer with sustainability expertise
and background can affect sustainability performance. The mid-level manager, on the other hand, has responsibility
only in his or her specific production line (Kanashiro & Rivera, 2017). The result of this study confirm the signaling theory
perspective that the presence of SO in the ISOE give good signal to the investors who want to invest in sustainable
companies.

5. CONCLUSION

To the best of our knowledge, this is the first study to provide empirical evidence by analyzing the presence of SO
in ISOEs and its relation to the SRI Kehati Index. So, this study provide contribution with regard to the sustainability
body of knowledge as well as corporate governance, since the SO is part of governance structure. This study provides
information to the practitioners that the presence of SO provide good impact for a company from investor perspective.

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