Ilona, desi and Zaitul, Zaitul and Okyere-Kwakye, Eugene and Asmeri, Rina (2022) SUPERVISORY BOARD DIVERSITY AND POLITICALLY CONNECTED COMPANIES PERFOMANCE. JURNAL ASET (AKUNTANSI RISET), 14 (2). pp. 363-376. ISSN : 2541-0342

[img] Text

Download (1MB)
Official URL:


Main Purpose - This study examines whether board diversity is lower in politically connected companies than in non-political affiliated companies and determines whether board diversity is less effective in a politically connected company. Method - Using 651 companies-years observation, the univariate analysis using the independent t-test and mean to see any significant difference of board diversity in the politically connected company vs non-connected companies. Besides, multiple regression analysis is employed to determine the effectiveness of board diversity in two types of companies. Main Findings – This study found that board diversity (national, gender, and experience diversity) is lower in politically connected companies, and there is a significant difference between these types of companies. Besides, board diversity is less effective in political companies than non-political affiliated companies. Only one board diversity (qualification diversity) is positively related to the performance of politically connected companies. Theory and Practical Implications - This study implies that politically connected companies should increase board diversity and its effectiveness to boost their performance. Theoretically, this study found that agency theories are not sound in politically connected companies. Novelty – This study provides insightful discussion about whether board diversity is worthwhile in politically connected companies in the unique continental European corporate governance system, Indonesia, where there was little discussion from previous studies.

Item Type: Article
Subjects: H Social Sciences > HF Commerce > HF5601 Accounting
Depositing User: Zaitul Zaitul
Date Deposited: 31 Mar 2023 10:21
Last Modified: 31 Mar 2023 10:21

Actions (login required)

View Item View Item