Corporate Governance and Corporate Social Responsibility On The Financial Performance Of Banking Companies

Abstract

Financial performance is an important aspect in company because it is a reference to the extent which the company has achieved its targets and how the company maintains its stability and credibility. According to a study from the World Bank, weak implementation of corporate governance is one of the causes of the crisis that occurred in Southeast Asia. Therefore, corporate governance is considered an important factor in improving company performance. Apart from corporate governance, Corporate Social Responsibility is also important because it affects the company's image. This research uses a quantitative approach with comparative causal research techniques. The sampling method uses purposive sampling at banking companies listed on the IDX. The analysis in this research uses multiple linear regression analysis. To fulfill the requirements specified in the use of multiple linear regression models, it is necessary to test several classical assumptions (normality test, multicollinearity test, heteroscedasticity test, autocorrelation test). To test the hypothesis, use the r square test, t test and f test. The conclusions of this research are (1) the audit committee has no effect on the company's financial performance, (2) institutional ownership has an effect on the company's financial performance, (3) corporate social responsibility has no effect on the company's financial performance, (4) the audit committee, institutional ownership and Corporate social responsibility simultaneously influences the company's financial performance