The effect of good corporate governance on dividend policy

Abstract

This study aims to determine the effect of good corporate governance on dividend policy. The study used a sample of all non-financial companies listed on the Indonesia Stock Exchange. T h i s research also used control variables of firm size, profitability, leverage, firm growth, and free cash flow. The results show that the variables of good corporate governance, firm growth and free cash flow had a positive significant effect on the dividend payout ratio. Meanwhile, the variable firm size, leverage, and profitability had a significant negative result on the dividend payout ratio.

The influence of corporate governance on firm value: a case study in Indonesian manufacturing industries

“…Financial performance significantly influences the firm value. These results are consistent with the research of Gunawan et al (2019). This result explains that when a company announces that its performance improves, shareholders' response increases the price.…”

“…Investors will respond to companies with good performance in the form of an increase in share pricesvice versa. Companies with satisfactory performance will be able to grow in the future (Gunawan et al, 2019). Novita et al (2016) showed that the essential variable influencing stock price is performance measured by earnings per share.…”

Effect of Corporate Governance and Corporate Social Responsibility on Financial Performance

“…(Saputra, 2018) show that, independent board of commissioners is the core of corporate governance assigned to ensure the implementation of corporate strategy, to maintain management in managing the company and to require the enforcement of accountability. This research of this study are different from the results of research conducted by (Zulfikar et al, 2017), (Andriana & Panggabean, 2017) and (Farida et al, 2018) which prove that independent commissioner has no effect on financial performance. (Andriana & Panggabean, 2017) states that the existence of an independent commissioner is only to meet the regulations set by the government.…”

“…The results of study performed by (Mahrani & Soewarno, 2018), (Saputra, 2018) and (Bintara, 2019) which states that independent commissioner has effect on financial performance. These results are different from the study performed by (Andriana & Panggabean, 2017), (Zulfikar et al, 2017) and (Farida et al, 2018) which stated, that independent commissioners has no effect on financial performance.…”

“…(Zulfikar et al, 2017) stated that independent commissioners cannot understand and carry out their duties as an independent party to oversee, direct, and evaluate the implementation of corporate governance. (Farida et al, 2018) stated the independent commissioner was not directly involved in operational activities. Their role is only to supervise and advise the director, most decisions are made by the director and management.…”