The Effect of Good Corporate Governance on Performance of Pharmaceutical Company

Abstract

The purpose of this study is to analyze the effect of good corporate governance which consists of the audit committee, board of directors, quality of External Auditor, and independent commissioners on the performance of pharmaceutical companies in Indonesia. Data of this study is all pharmaceutical companies in Indonesia, which in 2018 are listed in the Indonesian Capital Market Directory (2019), totaling 100 companies. Samples were taken by purposive sampling technique, based on the specified criteria obtained a sample of 88 companies. The data analysis method used is multiple regression analysis model usingthe SPSS for Windows Release 16.0 program. The results of this study indicate that the variable of the board of directors and the quality of External Auditor has a significant effect on company performance, whereas the audit committee and independent commissioners have no effect on company performance. The adjusted R2 value was 36.7%, the remaining 63.3% was explained by other factors outside the model under study.