The Impact of the Implementation of Corporate Governance on the Financial Performance of Non-finance Companies Registered in the Indonesian Stock Exchange
Abstract
This research aimed to observe the impact of corporate governance measured with the ranking of CGPI done by the Indonesian Institute for Corporate Governance (IICG) on the financial performance of companies measured using ROA, ROE, DER, DAR, and CR. The analysis method used was the linear regression method. The research sample was non-finance companies listed in the Indonesian Stock Exchange and registered as a member of CGPI during the period of 2012–2014. The results of this research showed that corporate governance has a positive correlation with ROA, DER, CR, and a negative correlation with the variables of ROE and DAR. Research has proved that the better management conducted by the company did not mean the dividends shared with the stockholders were larger.
Keywords: corporate governance, finance performance, ROA, ROE
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