Abstract: One of the internal factors that can impact the occurrence of financial distress is related to the mechanism of good corporate governance, namely the ownership structure and supervision in the company. This study aims to determine the effect of managerial ownership, institutional ownership and independent commissioners on financial distress. This research was conducted on all companies listed on the Indonesia Stock Exchange in 2019. The sample selection method was proportional stratified random sampling. The sample in this study was determined using the Slovin formula as many as 250 companies. The analysis technique of this research is logistic regression. Based on the results of the analysis, it was found that managerial ownership variables had a negative effect on financial distress, while institutional ownership and independent commissioners had no effect on financial distress. The implication of this study supports agency theory which states that agency conflicts that occur due to differences in interests can be minimized by implementing an ownership structure, so that companies can avoid financial distress.
Keywords: managerial ownership, institutional ownership, independent commissioner, financial distress.
Title: THE EFFECT OF MANAGERIAL OWNERSHIP, INSTITUTIONAL OWNERSHIP, AND INDEPENDENT COMMISSIONERS ON FINANCIAL DISTRESS
Author: Yorend Fiscienthar
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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