PENGARUH CORPORATE GOVERNANCE TERHADAP KINERJA KEUANGAN PERUSAHAAN DAN FINANCIAL DISTRESS (Studi Empiris Pada Perusahaan Non-Keuangan Yang Terdaftar Di Bursa Efek Indonesia Tahun 2017)

Abstract

This study aims to examine empirically the effect of corporate governance on financial performance and financial distress. Agency issues are a concern for corporate governance practices to deal with these problems. Corporate governance guidelines have been established to improve the quality of company values, which are composed of 16 points containing 103 items. The population in this study consisted of non-financial companies listed on the Indonesia Stock Exchange in 2017. The study used probability sampling methods, totaling 225 companies as the final sample number. Financial performance is measured by Tobin’s Q, while financial distress uses Altman Z-Score. If the lower Z-score value indicates the more likely the company has financial difficulties. This study uses two models in testing hypotheses. The first model uses multiple regression analysis to test the first hypothesis. The second model uses logistic regression analysis to test the second hypothesis. The results of this study indicate that corporate governance does not affect financial performance, but has a significant negative effect on financial distress.