The Influence of Corporate Governance on Company’s Financial Performance using Firm Size as Control Variable (Empirical Study on Regionally Owned Enterprises (BUMD) in Indonesia)
Abstract
This study aims to determine the effect of corporate governance on
financial performance. This type of research is an empirical study conducted on
regionally owned enterprises (BUMD) in Indonesia. The samples for this study
were 38 regionally owned enterprises that published annual reports for the period
2019-2022. The method used in collecting the data was purposive sampling. This
research used a regression analysis test. The results of this study indicate that the
board of directors and leverage positively affect financial performance. At the same
time, institutional ownership and audit committees have no positive effect on
financial performance. Based on the research above, the board of directors and
leverage have a very significant contribution to financial performance. Therefore,
it is necessary to make efforts to maintain the quality of the board of directors and
optimize the use of borrowed funds so that the companies can maintain the stability
of financial performance.
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