Financial Stability and Sustainability Performance of Indonesian Non-Banking Companies, as a Result of Their Capital Structure? Risky Budianto (a*), Alfa Rahmiati (b)
Departmen of Accounting, Faculty of Economic and Business, Airlangga University
*risky.budianto-2021[at]feb.unair.ac.id
Abstract
This study is to determine the effect of capital structure on the financial stability and sustainability performance of non-banking companies in Indonesia. Currently, similar research is still dominated by banking companies. The study used archival data with non-banking companies to go-public in Indonesia. Financial data was taken from the OSIRIS database and sustainability data from the ESGI dataset. The number of observations was 2177 firm years from 2015 to 2021. It used the panel fi-xed effect regression as the model^s application. Structure capital statistically positively affected financial stability for shareholders and short-term debt, while other proxies of long-term debt and debt-to-equity had a statistically negative effect on financial stability. Structure capital also negatively affected sustainability performance for proxy shareholders and short-term debt, while long-term debt proxies and DER were insignificant on sustainability performance. This study was not carried out in all sectors, so measuring financial stability and sustainability performance is still limited and needs to be tested more broadly. This study has filled in the gaps in the findings of previous studies that are still debatable and adds a proxy for measuring capital structure to complement the discussion study.
