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Journal : Amwaluna Jurnal Ekonomi dan Keuangan Syariah

Corporate Governance, Financial Leverage, and Performance of Sharia Manufacturing Companies on the Indonesia Stock Exchange Muhamad Umar Mai; Mochamad Edman Syarief; Kristianingsih Kristianingsih
AMWALUNA (Jurnal Ekonomi dan Keuangan Syariah) Vol 5, No 2 (2021)
Publisher : Univeristas Islam Bandung

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (391.305 KB) | DOI: 10.29313/amwaluna.v5i2.7053

Abstract

This paper discusses the impact of corporate governance on the leverage effect and the leverage effect on corporate performance. The study was conducted on Islamic manufacturing companies on the Indonesia Stock Exchange during the period 2012 to 2018. The data analytics method used Partial Least Square (PLS) which was handled with the WarpPLS application. The results show that almost all proxies of the corporate governance variable negatively affect financial leverage variable, except for the Independent Board of Commissioners (ICB) which has a positive effect on book leverage (BLEV). Furthermore, financial leverage as proxy by book leverage (BLEV) shows a positive effect on market performance (TBQ) and negative effect on book performance (ROA). The financial leverage effect by market leverage variable (VEML) has a negative effect on market performance (TBQ) as well as on accounting performance (ROA). An important implication of this study is that in general, Shariah manufacturing companies that are more profitable tend to reduce their financial leverage, and investors can better recognize the relationship between financial leverage decisions and firm performance.
Co-Authors Adetiya Sabrina M. Nur Afriady, Arif Ajeng Defi Aprilia Amin, Hanudin Anisa Herdian Arry Irawan Arry Irawan, Arry Arwan Gunawan Asep Junjunan Avitariani, Annisa Nurul Barnas, Benny Dadang Hermawan Dadang Hermawan Dahtiah, Neneng Destian Arshad Darulmalshah Tamara Dian Imanina Burhany Dimas Sumitra Danisworo Djoni Djatnika DWI SUHARTANTO Dwi Suhartanto Elsa Oktaviani Faishal, Hanif Fania Naurah Azizah Fathimah Awliyaul Alim Fauziah, Raihani Galuh, Nadya Raina Hadiani, Fatmi Hasbi Assidiki Mauluddi Hastuti Hastuti Henny Ariani Imam Akbar Ilham Arif Ira Andriani Ishak, Jouzar Farouq Jam, Nor Syakina Kamaluddin, Nurhadi Kristianingsih Kristianingsih Kristianingsih, Kristianingsih Lisna Oktaviani Ambarwati M. Rayhan Azis Moh Farid Najib Muhamad Faisal Pasha Ridwan Muhamad Faisal Pasha Ridwan Muhamad Muflih Muhammad Syaiful Nurasman Nadya, Galuh Raina Nahlarriva Zackia Nita Kurniasih Noorsyah Adi Noer Ridha Novianty, Ira Nurdin, Ade Ali Orryza Sativa Devi Pakpahan, Rosma Pratiwi, Leni Nur Putra, Sugih Sutrisno Putranda, Muhammad Imaduddin Radia Purbayati Rahmiatul Aula Raihani Fauziah Ramadhani, Rizkia Ramdani Ramdani Rani Putri Kusuma Dewi Razak, Dzuljastri Abdul Retno Gita Ayuningrum Riauli Susilawaty Hutapea Ring, Patrick J Rochendi, Hendi Ruhadi Ruhadi Ruhana, Nafisah Salsa Bila Azahra Salsabila Dwi Anggita Sa’bana, Rifqi Fauzan Sembiring, Etti Ernita Setianingsih, Ratih Setiawan Setiawan Shafanissa Aulia Zikri Shaikh, Imran Mehboob Siti Aisyah Sudradjat Sudradjat Sudradjat Sudradjat Sudradjat Sudradjat Sulistia Suwondo SUMIYATI SUMIYATI Supriatna, Iyeh Suwondo, Sulistia Syarief, Mochamad Edman Tiara Tresnawulan Barkah Tjetjep Djuwarsa Tripuspitorini, Fifi Afiyanti Via Muthmainnah Luthfi Widi Julianti Yanti Rufaedah, Yanti Yeni Siti Halimatus Sadi’yah Yunita Rizka Septiyani