Analysis of Determinants of Corporate Governance Rating (Empirical Study of Companies Listed in the CGPI Index Report 2015 – 2020)

Abstract

The monetary crisis that hit Indonesia in 1998 added to the confidence of economists and company management to implement Good Corporate Governance (GCG) practices in Indonesia. The implementation of good corporate governance is expected to be able to create added value for all interested parties. This study aims to determine the effect of ownership concentration, investment opportunity, leverage, profitability, and firm size on corporate governance rating. Using annual data for the period January 1, 2015 – December 31, 2020, with Panel Data Regression analysis with the Eviews 11 tool. The panel data regression test results show that leverage, profitability, and company size as macroeconomic variables influence corporate governance rating. Meanwhile, Ownership Concentration and Investment Opportunity do not affect corporate governance rating.