Development in rural areas has become the focus of governments in many countries. This study aims to analyze the effect of institutional pressure and strategic orientation on financial performance. This study also examines social performance as a mediating variable. The research was conducted at village institutions, namely Village-Owned Enterprises in four regions in Riau Province, Indonesia. A total of 239 Village-Owned Enterprises were studied with 526 respondents, namely VOE managers. Questionnaires were distributed directly and via the internet. Questionnaires were sent via WhatsApp to the VOE manager. Structural analysis of the equation model with Warp PLs shows that all hypotheses are supported. Institutional pressure and strategic orientation affect financial performance, and social performance is a mediator variable

Keywords: institutional pressure, strategic orientation, social performance, financial performance

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