Title:
THE IMPACT OF CORPORATE GOVERNANCE ON SUSTAINABILITY PERFORMANCE WITH STRATEGIC ORIENTATION AS INTERMEDIATE VARIABLE

Authors:
Mohamed Abdulrahim, Eko Ganis, Erwin Saraswati, Imam Subekti, Indonesia

Abstract:

The debate in the existing literature substantiates that there is a relationship between the size of the board and the capability of the company, which means that the number of directors on the board affects the company's capability, a large number of independent directors or non-executive directors on the board relates to good corporate governance. In this study, four corporate governance factors are considered as the determinants of sustainability performance. Furthermore, the mediating role of managers' strategic orientation was proposed in this study to provide an explanation of how the corporate governance mechanism effect sustainability performance. The population in this study is all sector companies listed in Indonesia Stock Exchange. Companies are selected as sample are companies in all sectors listed in Indonesia Stock Exchange for ten consecutive years. The conclusion is board size has a significant positive effect on the managers' strategic orientation and sustainability performance, board independence has a significant positive effect on the managers' strategic orientation and on sustainability performance, ownership concentration has a significant positive effect on strategic orientation and sustainability performance, institutional ownership has a significant positive effect on strategic orientation and sustainability performance, strategic orientation has a significant positive effect on sustainability performance, strategic orientation mediates the impact of board size, board independence, ownership concentration and institutional ownership on sustainability performance.