The tax avoidance strategy of listed companies in ASEAN Stock Exchange

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Abstract

Tax avoidance (TA) is the strategy used by companies to reduce their tax liabilities within the bounds of the law (Jarboui et al., 2020). The aims of this study are to explore the factors effectted to the TA behavior of companies listed in the Association of South East Asian Nations (ASEAN) Stock Exchange. This study was developed based on Mukhtaruddin et al.’s (2025) research. The environmental, social, and governance (ESG), financial distress (FD), financial performance (FP), and board gender diversity (BGD) are the factors that have an effect on TA practices. Firm size (FS) is used as a control variable. The sample is 185 companies from the ASEAN Stock Exchange (Indonesia, Malaysia, Singapore, the Philippines, and Thailand) for five years observation. The multiple regression analysis is used to answer the research questions. The findings indicated that the FD and FP have a positive and significant impact on TA. ESG has a negative and significant impact on TA. BGD initially shows no impact, but becomes positively significant when the role of FS is used as a control variable. A smaller number of companies’ disclosure of ESG performance are the limitation of this research. The regulators should have prepared the standards of ESG disclosure, making it easy to control and monitor. These findings highlight the importance of policymakers to monitor ESG practices, financial health, and board composition, as they meaningfully shape TA behaviour.

Keywords: Environmental, Social and Governance, Financial Distress, Financial Performance, Board Gender Diversity, Tax Avoidance

Authors’ individual contribution: Conceptualization — M., M.V., and A.N.; Methodology — M., A.N., and U.K.; Software — A.N., U.K., H.M.A.S., and R.H.S.; Validation — M.V., A.N., U.K., and R.H.S.; Formal Analysis — M., A.N., and H.M.A.S.; Investigation — A.N., U.K., and H.M.A.S.; Resources — U.K. and H.M.A.S.; Data Curation — A.N., U.K., H.M.A.S., and R.H.S.; Writing — M., M.V., and A.N.; Funding Acquisition — A.N., U.K., H.M.A.S., and R.H.S.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: L25, M14, M41, H26, O16

Received: 07.10.2025
Revised: 15.11.2025; 25.02.2026
Accepted: 27.03.2026
Published online: 31.03.2026

How to cite this paper: Mukhtaruddin, Verma, M., Novriansa, A., Kalsum, U., Angel Siahaan, H. M., & Safitri, R. H. (2026). The tax avoidance strategy of listed companies in ASEAN Stock Exchange. Corporate and Business Strategy Review, 7(2), 153–161. https://doi.org/10.22495/cbsrv7i2art14