Determinants for Banking Governance in Indonesia

Abstract

Objective: This study intends to conduct an empirical investigation to find the factors that determine good corporate governance on banking industry in Indonesia. Methodology: The method used in this article is partial least square regression. Results: The findings show that the leadership variables strengthen the quality of GCG practice. Fit and proper variable is proven to strengthen the influence of leadership variables on the quality of GCG practice. Implication: In the context of banking industry sustainability, concerns are paid to the potential and competitive strategy of bank. The performance of commercial bank requires structuring the quality of Good Corporate Governance (GCG) practices to be able to face and sustain in business risk. The greatest challenges arise from identifying determinants for banking governance to be sustained in Indonesian banking industry.


 


 


Keywords: leadership, good corporate governance, fit and proper. JEL classification: G21 •G28 •G32 •L21 •O47

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