The Effect of Family Ownership Structure, Independent Director and Independent Commissioner on Leverage
Yoke Yolanda (a*), Cynthia Afriani Utama (b)
a. Master of Management, Faculty of Economic and Business, Universitas Indonesia, Kampus UI Salemba 10430, Indonesia
b. Department of Management, Faculty of Economic and Business, Universitas Indonesia, Kampus UI Depok 16424, Indonesia
Abstract
The purpose of this research is to examine the relation between family ownership structure and leverage and also the indirect impact of independent commissioner and independent director on the relationship of the family ownership structure and leverage. This research applied a purposive sampling technique that resulted 22 Indonesian manufacturing public firms operated in the period of 2010-2018 as the sample. The panel data was collected from Thomson Reuters and family ownership data is manually collected from the company annual report. This research using multiple regression analysis with four models. The result provides that family ownership structure is negatively significant to leverage. Independent director and Independent commissionaire are not significantly related to the family ownership structure and leverage. The result of this research could help the company to make a financing decision and mitigate the agency problem.
Keywords: Leverage, Family Ownership Structure, Independent Director, Independent Commissionaire, Indonesia
Topic: Finance