Muhamad Umar Mai, Sudradjat Sudradjat


The purpose of this study was to examine the moderation of audit committee size on the effect of board characteristics on bank performance on the Indonesia Stock Exchange for the 2016-2020 period. The data analysis method used Partial Least Square-Structural Equation Modeling (PLS-SEM) which was processed with Warp-PLS software. The results of the analysis show that the size of the board of directors, independent board of commissioners, and female board of directors has a positive effect on bank performance, both Return on Assets (ROA) and Return on Equity (ROE). Board of directors meeting has a positive effect on ROE, but has no effect on ROA. Furthermore, the results of the analysis show that the size of the audit committee moderates the effect of the independent board of commissioners on bank performance, as measured by ROA and ROE.

Full Text:



Abidin, Zubaidah Zainal, Nurmala Mustaffa Kamal, and Kamaruzaman Jusoff. 2009. “Board Structure and Corporate Performance in Malaysia.” International Journal of Economics and Finance 1(1):150–64. doi: 10.5539/ijef.v1n1p150.

Adams, Renée B., and Daniel Ferreira. 2009. “Women in the Boardroom and Their Impact on Governance and Performance.” Journal of Financial Economics 94(2):291–309. doi: 10.1016/j.jfineco.2008.10.007.

Al-ahdal, Waleed M., Mohammed H. Alsamhi, Mosab I. Tabash, and Najib H. S. Farhan. 2020. “The Impact of Corporate Governance on Financial Performance of Indian and GCC Listed Firms: An Empirical Investigation.” Research in International Business and Finance 51(August 2019). doi: 10.1016/j.ribaf.2019.101083.

Al-Jaifi, Hamdan Amer. 2020. “Board Gender Diversity and Environmental, Social and Corporate Governance Performance: Evidence from ASEAN Banks.” Asia-Pacific Journal of Business Administration 12(3–4):269–81. doi: 10.1108/APJBA-12-2018-0222.

Al-Matari, Ebrahim Mohammed, Abdullah Kaid Al-Swidi, and Faudziah Hanim Bt Fadzil. 2014. “Audit Committee Characteristics and Executive Committee Characteristics and Firm Performance in Oman: Empirical Study.” Asian Social Science 10(12):98–113. doi: 10.5539/ass.v10n12p98.

Al-Nasser Mohammed, Sulaiman Abdullah Saif, and Datin Joriah Muhammed. 2017. “Financial Crisis, Legal Origin, Economic Status and Multi-Bank Performance Indicators Evidence from Islamic Banks in Developing Countries.” Journal of Applied Accounting Research 18(2):208–22. doi: 10.1108/JAAR-07-2014-0065.

Al-Okaily, Jihad, and Salma Naueihed. 2019. “Audit Committee Effectiveness and Family Firms: Impact on Performance.” Management Decision 58(6):1021–34. doi: 10.1108/MD-04-2018-0422.

Al-Okaily, Jihad, and Salma Naueihed. 2020. “Audit Committee Effectiveness and Family Firms: Impact on Performance.” Management Decision 58(6):1021–34. doi: 10.1108/MD-04-2018-0422.

Allam, Bahaaeldin Samir. 2018. “The Impact of Board Characteristics and Ownership Identity on Agency Costs and Firm Performance: UK Evidence.” Corporate Governance (Bingley) 18(6):1147–76. doi: 10.1108/CG-09-2016-0184.

Alsartawi, Abdalmuttaleb Musleh. 2019. “Board Independence, Frequency of Meetings and Performance.” Journal of Islamic Marketing 10(1):290–303. doi: 10.1108/JIMA-01-2018-0017.

Arora, Akshita, and Chandan Sharma. 2016. “Corporate Governance and Firm Performance in Developing Countries: Evidence from India.” Corporate Governance (Bingley) 16(2):420–36. doi: 10.1108/CG-01-2016-0018.

Aslam, Ejaz, and Razali Haron. 2020. “Corporate Governance and Banking Performance: The Mediating Role of Intellectual Capital among OIC Countries.” Corporate Governance (Bingley) 21(1):111–36. doi: 10.1108/CG-08-2020-0312.

Bansal, Nidhi, and Anil K. Sharma. 2016. “Audit Committee, Corporate Governance and Firm Performance: Empirical Evidence from India.” International Journal of Economics and Finance 8(3):103. doi: 10.5539/ijef.v8n3p103.

Belkhir, Mohamed. 2009. “Board of Directors’ Size and Performance in the Banking Industry.” International Journal of Managerial Finance 5(2):201–21. doi: 10.1108/17439130910947903.

Bezawada, Brahmaiah, and Sager Reddy Adaelli. 2020. “Corporate Governance, Board Characteristics and Performance of Indian Banks: An Empirical Study.” International Journal of Economics and Financial Issues 10(3):83–87. doi: 10.32479/ijefi.9536.

Bozec, Richard. 2005. “Boards of Directors, Market Discipline and Firm Performance.” Journal of Business Finance and Accounting 32(9–10):1921–60. doi: 10.1111/j.0306-686X.2005.00652.x.

Brenes, Esteban R., Kryssia Madrigal, and Bernardo Requena. 2011. “Corporate Governance and Family Business Performance.” Journal of Business Research 64(3):280–85. doi: 10.1016/j.jbusres.2009.11.013.

Brick, Ivan E., and N. K. Chidambaran. 2010. “Board Meetings, Committee Structure, and Firm Value.” Journal of Corporate Finance 16(4):533–53. doi: 10.1016/j.jcorpfin.2010.06.003.

Brown, Lawrence D., and Marcus L. Caylor. 2006. “Corporate Governance and Firm Valuation.” Journal of Accounting and Public Policy 25(4):409–34. doi: 10.1016/j.jaccpubpol.2006.05.005.

Buallay, Amina. 2018. “Audit Committee Characteristics: An Empirical Investigation of the Contribution to Intellectual Capital Efficiency.” Measuring Business Excellence 22(2):183–200. doi: 10.1108/MBE-09-2017-0064.

Chandani, Seema, Mashal Mabood, and Waqas Mahmood. 2018. “The Effect of Women Director on Banks Performance: Evidence from Pakistan.” Independent Journal of Management & Production 9(3):958. doi: 10.14807/ijmp.v9i3.737.

Cheng, Shijun. 2008. “Board Size and the Variability of Corporate Performance.” Journal of Financial Economics 87(1):157–76. doi: 10.1016/j.jfineco.2006.10.006.

Christensen, Jacqueline, Pamela Kent, and Jenny Stewart. 2010. “Corporate Governance and Company Performance in Australia.” Australian Accounting Review 20(4):372–86. doi: 10.1111/j.1835-2561.2010.00108.x.

Detthamrong, Umawadee, Nongnit Chancharat, and Chaiporn Vithessonthi. 2017. “Corporate Governance, Capital Structure and Firm Performance: Evidence from Thailand.” Research in International Business and Finance 42(July):689–709. doi: 10.1016/j.ribaf.2017.07.011.

Erkens, David H., Mingyi Hung, and Pedro Matos. 2012. “Corporate Governance in the 2007-2008 Financial Crisis: Evidence from Financial Institutions Worldwide.” Journal of Corporate Finance 18(2):389–411. doi: 10.1016/j.jcorpfin.2012.01.005.

Florackis, Chrisostomos. 2008. “Agency Costs and Corporate Governance Mechanisms: Evidence for UK Firms.” International Journal of Managerial Finance 4(1):37–59. doi: 10.1108/17439130810837375.

Ghazali, Nazli Anum Mohd. 2020. “Governance and Ownership in Malaysia: Their Impacts on Corporate Performance.” Asian Journal of Accounting Research 5(2):285–98. doi: 10.1108/ajar-03-2020-0017.

Gul, Ferdinand A., Bin Srinidhi, and Anthony C. Ng. 2011. “Does Board Gender Diversity Improve the Informativeness of Stock Prices?” Journal of Accounting and Economics 51(3):314–38. doi: 10.1016/j.jacceco.2011.01.005.

Hakimi, Abdelaziz, Houssem Rachdi, Rim Ben Selma Mokni, and Houda Hssini. 2018. “Do Board Characteristics Affect Bank Performance? Evidence from the Bahrain Islamic Banks.” Journal of Islamic Accounting and Business Research 9(2):251–72.

Haris, Muhammad, HongXing Yao, Gulzara Tariq, Ali Malik, and Hafiz Javaid. 2019. “Intellectual Capital Performance and Profitability of Banks: Evidence from Pakistan.” Journal of Risk and Financial Management 12(2):56. doi: 10.3390/jrfm12020056.

Hassan, Yousef M., Kamal Naser, and Rafiq H. Hijazi. 2016. “The Influence of Corporate Governance on Corporate Performance: Evidence from Palestine.” Afro-Asian Journal of Finance and Accounting 6(3):269–87. doi: 10.1504/AAJFA.2016.079296.

Herdjiono, Irine, and Indah Mega Sari. 2017. “The Effect of Corporate Governance on the Performance of a Company. Some Empirical Findings from Indonesia.” Journal of Management and Business Administration. Central Europe 25(1):33–52. doi: 10.7206/jmba.ce.2450-7814.188.

Hillman, Amy J., Christine Shropshire, and Albert A. Cannella. 2007. “Organizational Predictors of Women on Corporate Boards.” Academy of Management Journal 50(4):941–52. doi: 10.5465/AMJ.2007.26279222.

Hsu, Wen Yen, and Pongpitch Petchsakulwong. 2010. “The Impact of Corporate Governance on the Efficiency Performance of the Thai Non-Life Insurance Industry.” Geneva Papers on Risk and Insurance: Issues and Practice 35(SUPPL. 1):S28–49. doi: 10.1057/gpp.2010.30.

Husaini, and Saiful. 2017. “Enterprise Risk Management, Corporate Governance and Firm Value: Empirical Evidence from Indonesian Public Listed Companies.” Ijame 6(0):16–23.

Husaini, and Saiful. 2018. “Enterprise Risk Management, Corporate Governance and Firm Value: Empirical Evidence from Indonesian Public Listed Companies.” Ijame 6(0):16–23.

Jadah, Hamid Mohsin, Logasvathi A/P Murugiah, and Azira Binti Abdul Adzis. 2016. “The Effect of Board Characteristics on Iraqi Banks Performance.” International Journal of Academic Research in Accounting, Finance and Management Sciences 6(4):205–14. doi: 10.6007/IJARAFMS/v6-i4/2354.

Jensen, Michael C. 1994. “The Modern Industrial Revolution, Exit, and the Failure of Internal Control Systems.” Journal of Applied Corporate Finance 6(4):4–23.

Jubilee, Ribed Vianneca W., Roy W. L. Khong, and Woan Ting Hung. 2018. “Would Diversified Corporate Boards Add Value? The Case of Banking Institutions in Malaysia.” Asia-Pacific Journal of Business Administration 10(2–3):218–28. doi: 10.1108/APJBA-05-2018-0089.

Khan, Imran, and Syeda Nitasha Zahid. 2020. “The Impact of Shari’ah and Corporate Governance on Islamic Banks Performance: Evidence from Asia.” International Journal of Islamic and Middle Eastern Finance and Management 13(3):483–501. doi: 10.1108/IMEFM-01-2019-0003.

Kipkoech, Samoei Richard, and Lucy Rono. 2016. “Audit Committee Size, Experience and Firm Financial Performance. Evidence Nairobi Securities Exchange, Kenya.” Research Journal of Finance and Accounting 7(15):87–95.

Kusnadi, Yuanto, Kwong Sin Leong, Themin Suwardy, and Jiwei Wang. 2016. “Audit Committees and Financial Reporting Quality in Singapore.” Journal of Business Ethics 139(1):197–214. doi: 10.1007/s10551-015-2679-0.

Kutum, Imad. 2015. “Board Characteristics And Firm Performance: Evidence From Palestine.” Journal of Accounting 3(3):32–47.

Lehn, Kenneth M., Sukesh Patro, and Mengxin Zhao. 2009. “Determinants of the Size and Composition of US Corporate Boards: 1935-2000.” Financial Management 38(4):747–80. doi: 10.1111/j.1755-053X.2009.01055.x.

Liang, Qi, Pisun Xu, and Pornsit Jiraporn. 2013. “Board Characteristics and Chinese Bank Performance.” Journal of Banking and Finance 37(8):2953–68. doi: 10.1016/j.jbankfin.2013.04.018.

Liu, Yu, Zuobao Wei, and Feixue Xie. 2014. “Do Women Directors Improve Firm Performance in China?” Journal of Corporate Finance 28:169–84. doi: 10.1016/j.jcorpfin.2013.11.016.

McCahery, Joseph A., Zacharias Sautner, and Laura T. Starks. 2016. “Behind the Scenes: The Corporate Governance Preferences of Institutional Investors.” Journal of Finance 71(6):2905–32. doi: 10.1111/jofi.12393.

Musallam, Sami R. M. 2020. “Effects of Board Characteristics, Audit Committee and Risk Management on Corporate Performance: Evidence from Palestinian Listed Companies.” International Journal of Islamic and Middle Eastern Finance and Management 13(4):691–706. doi: 10.1108/IMEFM-12-2017-0347.

Ntim, Collins G., Jhon Kalimilo Malagila, Richard Crossley, and Samuel Fosu. 2017. “Corporate Governance and Dividend Pay-out Policy in UK Listed SMEs: The Effects of Corporate Board Characteristics.” International Journal of Accounting and Information Management 25(4):459–83. doi: 10.1108/IJAIM-02-2017-0020.

Ntim, Collins G., Teerooven Soobaroyen, and Martin J. Broad. 2017. “Governance Structures, Voluntary Disclosures and Public Accountability: The Case of UK Higher Education Institutions.” Accounting, Auditing and Accountability Journal 30(1):65–118. doi: 10.1108/AAAJ-10-2014-1842.

Nyamongo, Esman Morekwa, and Kebede Temesgen. 2013. “The Effect of Governance on Performance of Commercial Banks in Kenya: A Panel Study.” Corporate Governance (Bingley) 13(3):236–48. doi: 10.1108/CG-12-2010-0107.

Obiyo, Ofurum Cliffford, and Torbira Lezaasi Lenee. 2011. “Corporate Governance and Firm Performance in Malaysia.” Corporate Governance (Bingley) 1(4):1–12. doi: 10.1108/CG-03-2016-0054.

Ofoeda, Isaac. 2016. “And Non-Bank Financial Institutions Profitability Corporate Governance International Journal of Law and Management.”

Orazalin, Nurlan, Monowar Mahmood, and Keun Jung Lee. 2016. “Corporate Governance, Financial Crises and Bank Performance: Lessons from Top Russian Banks.” Corporate Governance (Bingley) 16(5):798–814. doi: 10.1108/CG-10-2015-0145.

Palaniappan, G. 2017. “Determinants of Corporate Financial Performance Relating to Board Characteristics of Corporate Governance in Indian Manufacturing Industry: An Empirical Study.” European Journal of Management and Business Economics 26(1):67–85. doi: 10.1108/EJMBE-07-2017-005.

Post, Corinne, Noushi Rahman, and Emily Rubow. 2011. Green Governance: Boards of Directors’ Composition and Environmental Corporate Social Responsibility. Vol. 50.

Puni, Albert, and Alex Anlesinya. 2020. “Corporate Governance Mechanisms and Firm Performance in a Developing Country.” International Journal of Law and Management 62(2):147–69. doi: 10.1108/IJLMA-03-2019-0076.

Rossi, Matteo, Marco Nerino, and Arturo Capasso. 2015. “Corporate Governance and Financial Performance of Italian Listed Firms. The Results of an Empirical Research.” Corporate Ownership and Control 12(2 CONT5):628–43. doi: 10.22495/cocv12i2c6p6.

Rutledge, Robert, Khondkar Karim, and Siyu Lu. 2016. “The Effects of Board Independence and CEO Duality on Firm Performance: Evidence from the NASDAQ-100 Index with Controls for Endogeneity.” Journal of Applied Business and Economics 18(2):49.

Salehi, Mahdi, Mohammad Tahervafaei, and Hossein Tarighi. 2018. “The Effect of Characteristics of Audit Committee and Board on Corporate Profitability in Iran.” Journal of Economic and Administrative Sciences 34(1):71–88. doi: 10.1108/jeas-04-2017-0017.

Shettima, Usman, and Nazam Dzolkarnaini. 2018. “Board Characteristics and Microfinance Institutions’ Performance: Panel Data Evidence from Nigeria.” Journal of Accounting in Emerging Economies 8(3):369–86. doi: 10.1108/JAEE-01-2017-0006.

Vafeas, Nikos. 1999. “Board Meeting Frequency and Firm Performance.” Journal of Financial Economics 53(1):113–42. doi: 10.1016/S0304-405X(99)00018-5.

Widnyana, I. Wayan, I. Gusti Bagus Wiksuana, Luh Gede Sri Artini, and Ida Bagus Panji Sedana. 2020. “Influence of Financial Architecture, Intangible Assets on Financial Performance and Corporate Value in the Indonesian Capital Market.” International Journal of Productivity and Performance Management (1999). doi: 10.1108/IJPPM-06-2019-0307.

DOI: https://doi.org/10.17509/jrak.v10i3.43926


  • There are currently no refbacks.

Creative Commons License

Jurnal Riset Akuntansi dan Keuangan  is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

View My Stats