Corporate Governance, Transparancy and Stock Return Synchronicity

Abstract

This study aims to analyze the effect of corporate governance on transparency as measured by stock return synchronicity. The variables used are board size (commissioner), big4 audit, institutional ownership, market to book, the volatility of firm fundamentals, leverage, and firm size. This study uses a quantitative approach with multiple linear analysis models. This study uses a sample of non-financial business entities listed on the Indonesia Stock Exchange (BEI). The number of samples used in this study was 198 observations. The results showed that the variable board size (commissioner), institutional ownership, and leverage had a positive effect on transparency, and the implied volatility of the firm hurt transparency. Other variables such as big4 audit, market to book ratio, and firm size do not affect transparency.

Riview Literatur Dengan Menggunakan ChatGPT

“…Namun, jika leverage diatur dengan baik, perusahaan dapat memanfaatkannya untuk investasi yang menguntungkan, sehingga dapat meningkatkan kinerja keuangan perusahaan. Wijaya (2021) membahas tentang hubungan antara corporate governance, transparansi, dan stock return synchronicity. Tata kelola perusahaan yang baik dan tingkat transparansi yang tinggi cenderung memiliki tingkat synchronicity yang lebih rendah, artinya tingkat return saham tidak selalu terkait dengan pergerakan market.…”

The Effects of Corporate Governance on Company Performance and Dividends in Three Asean Countries

“…With a large number and a variety of competencies, top management's supervision will be good so that information asymmetry between public shareholders and management can be reduced (Puni & Anlesinya, 2020). Despite several studies that reveal negative results because a large size will make coordination and communication more difficult (Christianto et al, 2021), most studies still support agency theory.…”

“…Several studies reveal that the use of debt gives a positive result on performance so that it also has a positive impact on dividend payments (Al Farooque et al, 2020;Benjamin & Biswas, 2019;Nguyen Trong & Nguyen, 2020). However, some studies state that when a company has debt, creditors will carry out supervision to the company so that the dividend function as a signal of the company's condition can be reduced (Al-Najjar & Kilincarslan, 2016;Christianto, Murhadi, & Wijaya, 2021;Tekin & Polat, 2020). The use of company size can positively affect performance and dividends, where large-sized companies tend to have stable performance and pay higher dividends (Baker, Dewasiri, Premaratne, & Yatiwelle Koralalage, 2020;Benjamin & Biswas, 2019;Nguyen Trong & Nguyen, 2020;Tekin & Polat, 2020).…”

“…The use of company size can positively affect performance and dividends, where large-sized companies tend to have stable performance and pay higher dividends (Baker, Dewasiri, Premaratne, & Yatiwelle Koralalage, 2020;Benjamin & Biswas, 2019;Nguyen Trong & Nguyen, 2020;Tekin & Polat, 2020). Meanwhile, some argue that analysts and investors relatively pay more attention to large-sized companies, so that the dividend function as a signal of the company's condition will decrease (Asali, Murhadi, & Sutejo, 2020;Christianto et al, 2021;Rajput & Jhunjhunwala, 2019;Sarwar, Xiao, Husnain, & Naheed, 2018). This research was conducted in three ASEAN countries, namely Indonesia, Malaysia, and Thailand, which have similar governance characteristics.…”