Factors Affecting the Financial Performance of Companies Based on Agency Theory

DOI

10.2991/aebmr.k.200127.022How to use a DOI?

Keywords

Agency theory, corporate governance, financial performance, institutional ownership, insider ownership

Abstract

This study examines the factors that influence a company’s financial performance based on agency theory. There were 5 independent variables used in this study, namely institutional ownership, insider ownership, board size, company size, and debt ratio, as well as the dependent variable, namely the company’s financial performance measured using Tobin’s Q ratio. This study used a quantitative approach using multiple linear regression analysis methods with a sample of 357 non-financial companies listed on the Indonesia Stock Exchange over the 2013-2017 period. Data processing used Eviews, where the results showed that institutional ownership, insider ownership, board size, company size, and debt ratio simultaneously had a significant positive effect on Tobin’s Q. However, if the variables were tested separately, it was found that institutional ownership, insider ownership, and debt ratio had a significant positive effect on Tobin’s Q, while firm size had a significant negative effect on Tobin’s Q and board size had no significant effect on Tobin’s Q.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - A. Herlambang
AU  - W.R. Murhadi
AU  - T. Andriani
PY  - 2020
DA  - 2020/01/31
TI  - Factors Affecting the Financial Performance of Companies Based on Agency Theory
BT  - Proceedings of the 17 th International Symposium on Management (INSYMA 2020)
PB  - Atlantis Press
SP  - 110
EP  - 114
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.200127.022
DO  - 10.2991/aebmr.k.200127.022
ID  - Herlambang2020
ER  -