Debt monitoring mechanism in soe’s: evidence from Indonesia / Murdifin Azhar and Ira Geraldina

-, Murdifin Azhar and -, Ira Geraldina (2020) Debt monitoring mechanism in soe’s: evidence from Indonesia / Murdifin Azhar and Ira Geraldina. Insight Journal : International, Refereed, Open Access, Online Journal, 6 (11). pp. 105-112. ISSN 2600-8564

Abstract

This study aims to examine the role of independent boards (commissioners) characteristics in monitoring the impact of debt on value of state-owned enterprises’ (SOE’s). This study used 125 observations of SOEs that are listed on Indonesia Stock Exchange during the period of 2010-2017 as a final sample. The variable of independent commissioner’s characteristics is analysed by identifying whether they have political connection with political party in Indonesia or not and whether they have adequate professional background. Using panel data analysis, the results show that there is a different effect of independent commissioner’s characteristics in monitoring the impact of debt on value of SOE’s. If independent commissioners do not have political connection, but have adequate professional background, they could conduct debt monitoring effectively, thereby increasing the value of SOE’s. On the contrary, if independent commissioners do not have political connection, but also do not have adequate professional background, they could not conduct debt monitoring effectively, thereby decreasing the value of SOEs. The results suggest that the goverment should consider the professional background of independent commissioners who have political connection with the rulling party.

Metadata

Item Type: Article
Creators:
Creators
Email / ID Num.
-, Murdifin Azhar
UNSPECIFIED
-, Ira Geraldina
UNSPECIFIED
Contributors:
Contribution
Name
Email / ID Num.
Chief Editor
Zainon, Assoc. Prof. Dr. Saunah
UNSPECIFIED
Editor
Ismail, Dr. Noriah
UNSPECIFIED
Editor
Raja Ahmad, Assoc. Prof. Dr. Raja Adzrin
UNSPECIFIED
Editor
Soo, Assoc. Prof. Dr. Carolyn Kum Yoke
UNSPECIFIED
Editor
Kadri, Assoc. Prof. Dr. Mohd Halim
UNSPECIFIED
Editor
Mohd Ariff Albakri, Assoc. Prof. Dr. Intan Safinas
UNSPECIFIED
Editor
Shamsuddin, Assoc. Prof. Dr. Hj Amanuddin
UNSPECIFIED
Editor
Zakaria, Assoc. Prof. Dr. Nor Balkish
UNSPECIFIED
Editor
Khairani, Dr. Noor Sufiawati
UNSPECIFIED
Editor
Othman, Dr. Akmal Aini
UNSPECIFIED
Editor
Ismail, Dr. Norashikin
UNSPECIFIED
Editor
Misman, Dr. Faridah Najuna
UNSPECIFIED
Editor
Mat Kamal, Dr. Siti Nuur-Ila
UNSPECIFIED
Subjects: H Social Sciences > HG Finance > Financial management. Business finance. Corporation finance
H Social Sciences > HG Finance > Financial management. Business finance. Corporation finance > Debt financing (Corporations)
Divisions: Universiti Teknologi MARA, Johor > Segamat Campus
Journal or Publication Title: Insight Journal : International, Refereed, Open Access, Online Journal
UiTM Journal Collections: UiTM Journal > INSIGHT Journal (IJ)
ISSN: 2600-8564
Volume: 6
Number: 11
Page Range: pp. 105-112
Related URLs:
Keywords: Capital structure, independent commissioner, state-owned enterprises’ (SOEs), debt monitoring and firm’s value, UiTM Cawangan Johor
Date: 2020
URI: https://ir.uitm.edu.my/id/eprint/42769
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