Author(s): Mirah Ayu Putri Trarintya, Ni Luh Putu Wiagustini, LG Sri Artini, I Wayan Ramantha
This study aims to examine the effect of intellectual capital which consists of structural capital, relationship capital, social capital and reputation capital on business sustainability practices that are mediated by financial performance. Many previous researchers measured business sustainability practices by using the Triple Bottom Line. In this study, it was measured by the Tri Warga concept, which is the concept of Balinese local culture that has been developed and has the same spirit as Profit, People, and Planet. Previous research has examined the effect of sustainability practices on financial performance, but in this study financial performance is used as a mediating variable. By using 100 samples of Village Credit Institutions (Lembaga Perkreditan Desa/LPD) which are Microfinance belonging to Traditional Villages in Bali, the relationship between variables was analyzed by using Structure Equation Modeling through the approach Partial Least Square. The results of the study concluded that capital structural and social capital had a significant positive effect on both performance financial and sustainability practices. Financial performance has a significant effect on sustainability practices. Only capital structural and social capital can be mediated by financial performance against sustainability practices as measured by Tri Warga.