Title:
Top Management Characteristics and State-owned Enterprises’s Performance: The Moderating Role of Government Financial Support

Authors:
Titis Grahito Krishandino, Atmaji, Indonesia

Abstract:

The objective of this research is to examine the effect of top management characteristics on the financial performance of state-owned enterprises (SOEs) in Indonesia and determine whether government financial support moderates this effect.  Literature on top management characteristics has generated arguments regarding their impact on financial performance, including the negative association of age and the positive effect of gender diversity on financial performance. Using officially published data from 2017 to 2021 and considering the impact of the Covid-19 pandemic that began in March 2020 in Indonesia, this study employed statistical models to provide empirical evidence regarding the estimated effects of board size, average age, and female proportion in top management on financial performance, with government financial support as a moderator. The results of this study indicate a positive association between financial performance and the size of the board of commissioners, while average age and female proportion tend to have the opposite effect. Meanwhile, top management characteristics at the director level were found to have no significant effect on company financial performance. Lastly, this research demonstrates that government financial support does not significantly moderate the effect of top management characteristics on financial performance.  The findings from this study are expected to provide insights that can be applied in the implementation of state-owned enterprise management policies in Indonesia.

DOI: https://doi.org/10.51505/IJEBMR.2023.71017