THE ROLE OF CORPORATE GOVERNANCE IN BANKING PERFORMANCE: HIGHLIGHTED DURING THE COVID PANDEMIC (Evidence In Indonesian Bank)
Didit Suryoadi, Grahita Chandrarin, Maxion Sumtaxy

University of Merdeka Malang

Abstract

The study aims to analyze the impact of Board Size, Number of Non-Executive Directors on Board, and Size of Audit Committee on Return on Assets (ROA) and Tobin^s Q on banks listed on the Indonesian Stock Exchange between 2019 and 2022. The research method used is descriptive statistical analysis and regression test on a sample of 11 banking companies in Indonesia. The data used included relevant variables such as Board size, Non-Executive Director composition, Audit Committee size, ROA, and Tobin^s Q. The results of the analysis show that Board Size has a significant influence on ROA. However, Board Size had no significant influence on Tobin^s Q. Furthermore, the number of non-executive directors on board also proved to have a significant influence on ROA. However, the Number of Non-Executive Directors on Board did not have a significant influence on Tobin^s Q. In addition, the Size of Audit Committee also proved to have a significant influence on ROA and Tobin^s Q. The larger size of the Audit Committee provides more effective supervision, better risk management, and transparency in financial reporting, which has a positive impact on the company^s financial performance and market assessment. These findings have important implications that other factors, such as business strategies, risk management policies, or broader external factors, may more influence the company^s performance.

Keywords: Board Size, Number of Non-Executive Directors on Board, Size of Audit Committee, Return on Assets, Tobin^s Q, Bank, Indonesia Stock Exchange

Topic: Digital Economic Transformations Post Covid-19 Pandemic