CORPORATE GOVERNANCE, CAPITAL STRUCTURE, AND CORPORATE INVESTMENT: AN EMPIRICAL STUDY ON PROPER MANUFACTURING INDUSTRY IN INDONESIA

Investment is one of the most crucial decisions that a company must create to achieve higher financial performance and to maintain long-term sustainability. This study predicts that two significant factors determine corporate investment, i.e., the firms’ corporate governance and capital structure. The article also assumes that companies that are aware and engage in environmental programs would find it much easier to gain investors’. This study used 39 units of analysis of 13 manufacturers listed on the Indonesia Stock Exchange that received a good ranking in PROPER during the 2016-2018 period and analyzed with structural equation modeling (SEM). This study finds that corporate governance is negatively related to the capital structure but positively related to corporate investment. However, the capital structure does not affect corporate investment implying environmental performance’s significance in leading corporate governance and enhancing corporate investment. Further research can extend the observation period, use other sectors as the sample, use the different indicators in each variable, and develop the relationship between variables on a broader framework.

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INFLUENCE OF INTELLECTUAL CAPITAL AND CAPITAL STRUCTURE OF THE COMPANY VALUE THROUGH FINANCIAL PERFORMANCE AS AN INTERVENING VARIABLE (CASE STUDY AT MANUFACTURING COMPANIES LISTED IN INDONESIA STOCK EXCHANGE PERIOD 2013-2017)

AFEBI Economic and Finance Review ◽

10.47312/aefr.v4i02.264 ◽

2020 ◽

Vol 4 (02) ◽

pp. 101

Author(s):

Syari Octavia ◽

Ahmad Fauzan Fathoni ◽

Yulia Efni

Keyword(s):

Capital Structure ◽

Financial Performance ◽

Intellectual Capital ◽

Stock Price ◽

Structural Equation ◽

Manufacturing Industry ◽

Stock Exchange ◽

Equation Modeling ◽

Manufacturing Companies ◽

Company Value

Manufacturing industry is the industry that the largest contribution to GDP growth until 2017. Although still the largest source of the increase in GDP, the contribution of manufacturing to GDP continued to decline since 2015. However, this does not cause the stock price decline of manufacturing. Based on this phenomenon, this study aims to examine the internal factors are thought to be able to increase the value of the company. The population in this study are all manufacturing companies listed in Indonesia Stock Exchange in 2013-2017 as many as 144 companies with a total sample of 76 companies that obtained by purposive sampling. Then, samples were analyzed using Structural Equation Modeling results show that IC and capital structure does not directly affect the value of the company. But IC and capital structure directly affects financial performance. Thus, the financial performance is able to mediate the effects of IC and capital structure to the company's value. The better the financial performance of a company, the better is also the company's value in the eyes of investors.Keywords: Intellectual Capital, Capital Structure, Financial Performance, Company Value

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Analisis Struktur Kepemilikan, Faktor Eksternal, Internal Terhadap Struktur Modal, Dividen, Nilai Perusahaan Manufaktur

E-Jurnal Akuntansi ◽

10.24843/eja.2020.v30.i06.p11 ◽

2020 ◽

Vol 30 (6) ◽

pp. 1484

Author(s):

Nurianah Nurianah ◽

Muslich Anshori

Keyword(s):

Capital Structure ◽

Ownership Structure ◽

Firm Value ◽

Structural Equation ◽

Dividend Policy ◽

Stock Exchange ◽

External Factors ◽

Equation Modeling ◽

Internal Factors ◽

Company Value

This study discusses and analyzes the Ownership Structure, External Factors, Internal Against Capital Structure, Dividends and Company Value. The population used in this study is companies listed on the Indonesia Stock Exchange using 37 companies. The data used are from 2010 to 2019, this study uses descriptive statistical analysis and inference with Structural Equation Modeling (SEM). The analysis shows: ownership structure does not oppose capital structure, dividend policy, and firm value, external factors affect internal factors, external factors do not oppose capital structure, external factors do not significantly influence firm value, internal factors related to capital structure, factors internal does not oppose dividend policy, internal factors oppose company value, capital structure opposes dividend policy, dividend policy has no effect on capital structure, capital structure is related to company value, and dividend policy is related to company value. Keywords: Ownership Structure; External and Internal Factors; Dividend Policy; Manufacture.

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PROFITABILITY, GROWTH OPPORTUNITY, CAPITAL STRUCTURE AND THE FIRM VALUE

Buletin Ekonomi Moneter dan Perbankan ◽

10.21098/bemp.v16i2.440 ◽

2014 ◽

Vol 16 (2) ◽

pp. 115-136 ◽

Cited By ~ 2

Author(s):

Sri Hermuningsih

Keyword(s):

Capital Structure ◽

Structural Equation Model ◽

Firm Value ◽

Structural Equation ◽

Stock Exchange ◽

Listed Companies ◽

Equation Model ◽

Growth Opportunity ◽

The Capital Structure

This paper examines the influence of profitability, growth opportunity, and capital structure on firm value. We apply Structural Equation Model (SEM) on 150 listed companies on the Indonesia Stock Exchange during 2006 to 2010. The result shows that profitability, growth opportunity and capital structure positively and significanctly affect the company’s value. Secondly, the capital structure intervene the effect of growth profitability on company’s value, but not for profitability. Keywords: profitability, growth opportunitiy, capital structure, firm value, SEM.JEL Classification: C51, G32, L25

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PENGARUH PROFITABILITAS, GROWTH OPPORTUNITY, STRUKTUR MODAL TERHADAP NILAI PERUSAHAAN PADA PERUSAHAAN PUBLIK DI INDONESIA

Buletin Ekonomi Moneter dan Perbankan ◽

10.21098/bemp.v16i2.27 ◽

2014 ◽

Vol 16 (2) ◽

pp. 127-148 ◽

Cited By ~ 3

Author(s):

Sri Hermuningsih

Keyword(s):

Capital Structure ◽

Structural Equation Model ◽

Firm Value ◽

Structural Equation ◽

Stock Exchange ◽

Listed Companies ◽

Equation Model ◽

Growth Opportunity ◽

The Capital Structure

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MY BUSINESS AND I: ENTREPRENEUR PERSONALITY TRAITS AND CAPITAL STRUCTURE CHOICE

RAM Revista de Administração Mackenzie ◽

10.1590/1678-6971/eramd200300 ◽

2020 ◽

Vol 21 (6) ◽

Author(s):

KELMARA M. VIEIRA ◽

VANESSA M. VALCANOVER ◽

ANI C. G. POTRICH ◽

EVERTON A. CAVALHEIRO

Keyword(s):

Locus Of Control ◽

Capital Structure ◽

Personality Traits ◽

Structural Equation ◽

Risk Tolerance ◽

Equation Modeling ◽

Internal Locus ◽

Internal Locus Of Control ◽

The Government ◽

The Capital Structure

ABSTRACT Purpose: This research seeks to identify how entrepreneurs’ personality traits can influence the capital structure of micro and small private businesses in Brazil, which are important for the economic growth and the subsistence of their owners. Originality/value: The study of the behavioral dimension of business decisions can help financial agents to better understand client behavior, including the adoption of mechanisms that identify possible risky or inefficient decisions made by managers based on their personality traits. It can also assist the government and institutions supporting micro and small private businesses in developing strategies to reduce the mortality of such companies. Design/methodology/approach: The proposed model involves 19 expected relationships that evaluate the relationships between the optimism, risk tolerance, sense of control (external and internal), attitude towards debt, and entrepreneur gender constructs. The sample includes 625 micro and small entrepreneurs in the state of Rio Grande do Sul, Brazil. Confirmatory factor analysis and structural equation modeling were performed. Findings: Results showed that attitude towards debt and gender were the most significant constructs and had a direct influence on the capital structure, while optimism and internal locus of control exerted a negative indirect influence, while risk tolerance had a positive indirect effect. Female managers demonstrated higher optimism and internal locus of control than male managers, but they had a worse attitude towards debt.

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Analisis Profitabilitas, Struktur Aset, Dan Pertumbuhan Aset Terhadap Struktur Modal Yang Dimoderasi Likuiditas

Gorontalo Accounting Journal ◽

10.32662/gaj.v3i1.749 ◽

2020 ◽

Vol 3 (1) ◽

pp. 16

Author(s):

Ade Ningrum Mulyasari ◽

Subowo Subowo

Keyword(s):

Statistical Analysis ◽

Capital Structure ◽

Stock Exchange ◽

Sampling Technique ◽

Negative Influence ◽

Units Of Analysis ◽

Negative Effect ◽

Study Population ◽

Asset Growth ◽

The Capital Structure

This study aims to analyze the effect of profitability, asset structure, and asset growth on capital structure with liquidity as moderation. The study population is non-financial companies in the LQ45 index listed on the Indonesia Stock Exchange (IDX) in 2015-2017. The sampling technique is purposive sampling. The study sample are 27 companies for 3 years resulting in 81 units of analysis. The data analysis method used is descriptive statistical analysis and inferential statistical analysis using moderation regression analysis (MRA). The results showed that profitability and asset growth were positive and significant for the capital structure, the asset structure had a significant negative effect on the capital structure. Liquidity also moderates the negative influence of profitability on the capital structure. Liquidity is not able to moderate the influence of asset structure and asset growth on capital structure.

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Investigating the effect of corporate governance on audit quality and its impact on investment efficiency

Investment Management and Financial Innovations ◽

10.21511/imfi.17(3).2020.14 ◽

2020 ◽

Vol 17 (3) ◽

pp. 175-188

Author(s):

Walid Shehata Mohamed Kasim Soliman

Keyword(s):

Corporate Governance ◽

Structural Equation ◽

Audit Quality ◽

Stock Exchange ◽

Investment Decisions ◽

Equation Modeling ◽

Investment Efficiency ◽

Listed Firms ◽

Good Environment ◽

Egyptian Stock Exchange

There is an academic discussion about investment efficiency, regarding its determinants and effects. Corporate Governance (CG) and Audit Quality (AQ) are determinants of investment efficiency The main objective of the article is to investigate the effect of CG and AQ on investment efficiency, this objective is divided into sub-objectives: to investigate the direct effect of CG on AQ, AQ on investment efficiency, and CG on investment efficiency. Moreover, the indirect effect of CG on investment efficiency through AQ as a mediator variable. This paper focuses on non-financial listed firms in the Egyptian Stock Exchange (EGX), especially firms recorded in EGX 100 for four years’ period (2013–2018), for 103 firms and 412 completed observations. The researcher uses Structural Equation Modeling (SEM) through SmartPLS software. The paper shows evidence that management that has good CG mechanisms obtains a suitable atmosphere to prepare transparent financial statements, which helps enhance the auditor’s role and improve AQ. Improving AQ lowering IA, which increases the trust of investors in management decisions, this leads to reduce pressure on management and improve efficiency of investment decisions. Having good CG mechanisms provides management with a good atmosphere to make right investment decisions, and having good CG mechanisms increases AQ, which helps management to have a good environment to make investment decisions with higher efficiency, or in other words, there is a significant and positive effect of integration between CG and AQ on investment efficiency.

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The impact of co-structure of capital, profitability and corporate growth opportunities on stock exchange in Indonesia

Journal of Economic and Administrative Sciences ◽

10.1108/jeas-08-2019-0081 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Teddy Chandra ◽

Achmad Tavip Junaedi ◽

Evelyn Wijaya ◽

Martha Ng

Keyword(s):

Capital Structure ◽

Structural Equation ◽

Stock Exchange ◽

Reciprocal Relationship ◽

Growth Opportunities ◽

Content Type ◽

Reciprocal Influence ◽

Growth Opportunity ◽

The Impact ◽

The Capital Structure

PurposeThe purpose of this paper is (1) to determine the factors that significantly influence the capital structure, (2) to determine the factors that significantly influence profitability, (3) to find the factors that significantly influence growth opportunities, (4) to find reciprocal influence between capital structure and profitability and (5) to find reciprocal influence between capital structure and growth opportunity.Design/methodology/approachThe population of this research is a manufacturing company listed on the Indonesia Stock Exchange during the period of 2010–2016. The number registered in the manufacturing sector is 144 companies. The sampling technique applied is purposive sampling. The fulfillment criteria are companies that have been approved before 2010. Another criterion is that the company is not delisting during the observation period. From that total of population, companies that meet the requirements are 117 companies. This observation was conducted for seven years since 2010–2016, so the center of the analysis of this research was a total of 819. The inferential statistics method used to analyze the research data is generalized structural component analysis (GSCA).FindingsThe results of this study indicate that (1) the factors that influence the capital structure include effective tax rate, financial flexibility, growth, uniqueness, asset Utilization, firm size and tangibility; (2) factors that affect profitability include liquidity, growth, firm age, uniqueness, tangibility, volatility, advertising and asset turnover; (3) growth opportunity have a negative and significant influence on capital structure. This means an increase in growth opportunity can be defined as an increase in depreciation that will not be used as collateral for managers to increase debt. This increase in debt will have an impact on reducing growth opportunities; (4) profitability and capital structure have a two-way causality relationship, which means they influence each other and (5) capital structure and growth opportunities have a negative reciprocal relationship.Originality/valueThe authenticity of the study is implied in the following explanation: The authors try to examine the reciprocal effect of capital structure on profitability and capital structure on growth opportunities and the factors that influence these two endogenous variables that have never been done by previous researchers. This research is motivated by research conducted by (Chathoth and Olsen, 2007; Jian-Shen Chen et al., 2009; Yang et al., 2010) using the structural equation model (SEM). However, this study uses GSCA as a method of research analysis.

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Analysis of Banking Risk, Good Corporate Governance, Capital and Earning Influences on the Indonesia’s Commercial Bank Performances

10.31219/osf.io/vqm9y ◽

2021 ◽

Author(s):

M. Nuruddin Subhan

Keyword(s):

Corporate Governance ◽

Commercial Bank ◽

Commercial Banks ◽

Structural Equation ◽

Stock Exchange ◽

Partial Least Square ◽

Least Square ◽

Equation Modeling ◽

Good Corporate Governance ◽

Bank Soundness

This study aims to analyze the effect of commercial bank soundness in Indonesia based on Bank Indonesia regulation number 13/24/DPNP date 25 October 2011, which concern on the implementation guide for Bank Regulation in Indonesia number 13/1/PBI/ 2011 on assessment of bank healthy. In general, those assessments cover risks, good corporate governance (GCG), earning and capital. While, the performance of commercial bank is measured based on credit growth and profit growth. A total of 45 commercial banks listed on the Indonesia Stock Exchange are the population of the study which will be analyzed using the structural equation modeling program - partial least square (SEM-PLS). The results show that credit risk, GCG and earnings have no effect on bank’s performance in Indonesia. Market risk, liquidity risk and capital negatively affect the performance of commercial banks in Indonesia. This research is expected to contribute to the policy making of central banks and also commercial bank organization in particular to improve their performance. This research also contributes to the theory by enriching the discussion on related themes.

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Enterprise characteristics, capital structure and operational performance: The case of listed enterprises in Vietnam

Corporate Ownership and Control ◽

10.22495/cocv13i4c4p1 ◽

2016 ◽

Vol 13 (4) ◽

pp. 529-534

Author(s):

Doan Ngoc Phi Anh

Keyword(s):

Capital Structure ◽

Structural Equation ◽

Stock Exchange ◽

State Ownership ◽

Operational Performance ◽

Equation Modeling ◽

Long Run ◽

Negative Effect ◽

Positive Effect

This paper examines the relationship between enterprise characteristics, capital structure and operational performance among a sample of 592 companies listed on the Vietnamese stock exchange during the three years 2012-2014. Whilst most previous studies in this area have used multiple regression as the main method of analysis, the paper follows the examples of Titman and Wessels (1988) and Chang et al. (2009) and adopts a structural equation modeling (SEM) approach. Specifically, path analysis was employed to analyze simultaneous relationships among the various variables. The results suggest that for listed enterprises in Vietnam, operational performance has a negative effect on both of the measures of capital structure considered, namely long-term debt/total assets ratio (LDR) and short-term debt/total assets ratio (SDR), while the extent of state ownership has a positive effect on LDR and enterprise age has a positive effect on SDR only. The ratio of long-run to total assets affects the two capital structure measures in opposite ways: the effect is positive on LDR and negative on SDR. The evidence was considered to be inconclusive on the question of direction of causality between operational performance and LDR.

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