Anti-Corruption Disclosure, Investment Policy and Cultural Diversity on Firm Performance: Does the Board Experience Matter?
Abstract
The intention of this exploration examines the clout of anti-corruption disclosure (ACD), investment policy (INVP) and cultural diversity (CULDIV) on firm performance (FP) and board experience (BEXP) as a moderating variable. The population of this study consists of 193 manufacturing entities listed on the Indonesian Stock Exchange, imply purposive sampling method with criteria declared so that 28 entities were seized with 5 years of observation, generate 140 entities data (financial statement and annual report) were come by. Data analysis applied moderate regression analysis (MRA). The upshot points that: 1) Anti-Corruption Disclosure have a positively and significance effect on FP (TBQ); 2) Investment Policy have adverse and significance effect on FP (ROA); 3) Cultural Diversity have adverse and significance effect on FP (TBQ); 4) Board Experience weaken the consequence of Anti-Corruption Disclosure to FP (TBQ); 5) Board Experience weaken the consequence of Investment Policy on FP (ROA); 6) Board Experience weaken the consequence of Cultural Diversity on FP (TBQ).
References
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Al-Gamrh, B., Ku Ismail, K. N. I., Ahsan, T., & Alquhaif, A. (2020). Investment opportunities, corporate governance quality, and firm performance in the UAE. Journal of Accounting in Emerging Economies, 10(2), 261–276. https://doi.org/10.1108/JAEE-12-2018-0134
Ashyrov, G., & Akuffo, I. N. (2020). Dimension of corruption and firm performance: an empirical analysis from BEEPS survey. International Journal of Social Economics, 47(3), 384–403. https://doi.org/10.1108/IJSE-08-2019-0476
Braendle, U., Stiglbauer, M., Ababneh, K., & Dedousis, E. (2020). The impact of board diversity on firm performance – The case of Germany. Corporate Ownership and Control, 17(2), 183–193. https://doi.org/10.22495/cocv17i2art15
Brahma, S., Nwafor, C., & Boateng, A. (2020). Board gender diversity and firm performance: The UK evidence. International Journal of Finance and Economics, July. https://doi.org/10.1002/ijfe.2089
Certo, S. T., Lester, R. H., Dalton, C. M., & Dalton, D. R. (2006). Top management teams, strategy and financial performance: A meta-analytic examination. Journal of Management Studies, 43(4), 813–839. https://doi.org/10.1111/j.1467-6486.2006.00612.x
Coonjohn, B. J. J., & Approaches, C. A. (2011). Developing a Strategic Implementation Plan for Anti-Corruption 1.
Deegan, C. (2002). Introduction: The legitimising effect of social and environmental disclosures – a theoretical foundation. Accounting, Auditing & Accountability Journal, 15(3), 282–311. https://doi.org/10.1108/09513570210435852
Devi, S., Warasniasih, N. M. S., & Masdiantini, P. R. (2020). The Impact of COVID-19 Pandemic on the Financial Performance of Firms on the Indonesia Stock Exchange. Journal of Economics, Business, & Accountancy Ventura, 23(2), 226–242. https://doi.org/10.14414/jebav.v23i2.2313
Doh, J., Rodriguez, P., Uhlenbruck, K., Collins, J., & Eden, L. (2003). Coping with corruption in foreign markets - Executive Commentary. Academy of Management Executive, 17(3), 128–129. https://doi.org/10.5465/ame.2003.10954781
Etxeberria, I., & Odriozola, M. (2018). The social reputation of European companies: Does anti-corruption disclosure affect stakeholders’ perceptions? Corporate Social Responsibility and Environmental Management, 25(5), 713–721. https://doi.org/10.1002/csr.1488
Fama, E. F., & French, K. R. (1998). Taxes, Financing Decisions, and Firm Value. The Journal of Finance. The Journal of Finance, 53(3), 819–843.
Fernández-Temprano, M. A., & Tejerina-Gaite, F. (2020). Types of director, board diversity and firm performance. Corporate Governance (Bingley), 20(2), 324–342. https://doi.org/10.1108/CG-03-2019-0096
Fitria, G. N. (2021). The Effect of Management Accounting System, Sustainable Leadership and Environmental Strategy on Business Performance with Organizational Culture as Moderator. International Journal of Contemporary Accounting, 3(1), 45–60.
Freeman, R. E. (1984). Books. Cambridge University Press.
Golubeva, O. (2021). Firms’ performance during the COVID-19 outbreak: international evidence from 13 countries. Corporate Governance (Bingley). https://doi.org/10.1108/CG-09-2020-0405
Hambrick, D. C., & Mason, P. . (1984). Upper Echelon: The organisation as a reflection of its top managers. The Academy of Management Review, 16(1), 20–36. https://doi.org/10.1057/s41310-019-00054-0
Hess, D. (2009). Catalyzing corporate commitment to combating corruption. Journal of Business Ethics, 88(SUPPL. 4), 781–790. https://doi.org/10.1007/s10551-009-0322-7
Hills, G., Fiske, L., & Mahmud, A. (2009). Anti-corruption as Strategic CSR : A call to action for corporations. May, 1–52. www.ethics.org/files/u5/AnticorruptionFINAL.%5Cnpdf.%5CnHoi, Y.H., Lin, C.Y., 2012.
Joseph, C., Gunawan, J., Sawani, Y., Rahmat, M., Avelind Noyem, J., & Darus, F. (2016). A comparative study of anti-corruption practice disclosure among Malaysian and Indonesian Corporate Social Responsibility (CSR) best practice companies. Journal of Cleaner Production, 112, 2896–2906. https://doi.org/10.1016/j.jclepro.2015.10.091
Kalyuzhnova, Y., & Belitski, M. (2019). The impact of corruption and local content policy in on firm performance: Evidence from Kazakhstan. Resources Policy, 61(January), 67–76. https://doi.org/10.1016/j.resourpol.2019.01.016
Kells, S. (2020). Impacts of COVID-19 on corporate governance and assurance, international finance and economics, and non-fiction book publishing: some personal reflections. Journal of Accounting and Organizational Change, 16(4), 629–635. https://doi.org/10.1108/JAOC-08-2020-0115
Koentjaraningrat. (2002). Manusia dan Kebudayaan di Indonesia. Djambatan.
Lange, D. (2008). A multidimensional conceptualization of organizational corruption control. Academy of Management Review, 33(3), 710–729. https://doi.org/10.5465/AMR.2008.32465742
Lo, F. Y., Wang, Y., & Zhan, W. (2020). Does TMT cultural diversity contribute to firm performance and do socialisation and tenure matter? A test of two competing perspectives. Personnel Review, 49(1), 324–348. https://doi.org/10.1108/PR-11-2018-0468
Majeed, A., & Ahmed, S. (2018). Does Cultural diversity of Board of Directors and Audit Committee Dynamics Affect Firm Performance? Evidence from Firms in Karachi Meezan Index. Journal of Islamic Business and Management (JIBM), 8(2), 465–479. https://doi.org/10.26501/jibm/2018.0802-008
Mazur, B., & Bialostocka, P. (2010). Cultural diversity in feminist therapy: Theory and practice. Journal of Intercultural Management, 2(2), 5–15. https://doi.org/10.1037/10501-007
Mehmood, R., Hunjra, A., & Chani, M. (2019). The Impact of Corporate Diversification and Financial Structure on Firm Performance: Evidence from South Asian Countries. Journal of Risk and Financial Management, 12(1), 49. https://doi.org/10.3390/jrfm12010049
Mir-Babayev, R., Gulaliyev, M., Shikhaliyeva, S., Azizova, R., & Ok, N. (2017). The impact of cultural diversity on innovation performance: Evidence from construction industry of Azerbaijan. Economics and Sociology, 10(1), 78–93. https://doi.org/10.14254/2071-789X.2017/10-1/6
Nederveen, A., Knippenberg, D., & Dierrerdonck, D. (2013). Cultural diversity and team performance: The role of team member goal orientation. Academy of Management Journal, 56(3), 782–804. https://doi.org/10.5465/amj.2010.0992
Nnaoma, F., & Omotosho, O. (2017). Impact of Corporate Social Responsibility on the Performance of Manufacturing Firms in Nigeria. European Journal of Business and Management, 9, 94–129. https://doi.org/10.20431/2349-0349.0807001
Nobanee, H., Atayah, O. F., & Mertzanis, C. (2020). Does anti-corruption disclosure affect banking performance? Journal of Financial Crime, 27(4), 1161–1172. https://doi.org/10.1108/JFC-04-2020-0047
O’Higgins, E. (2006). Corruption, Underdevelopment, and Extractive Resource Industries: Addressing the Vicious Cycle. Business Ethics Quarterly, 16(2), 235–254. https://doi.org/10.1017/s1052150x00012823
Osuji, O. (2011). Fluidity of Regulation-CSR Nexus: The Multinational Corporate Corruption Example. Journal of Business Ethics, 103(1), 31–57. https://doi.org/10.1007/s10551-011-0840-y
Pandiangan, R., & Murwaningsari, E. (2019). Liquidity Moderating the Effect of Production Resources, Investment Decisions and Corporate Social Responsibility on Corporate Performance. Research Journal of Finance and Accounting, 10(20), 33–42. https://doi.org/10.7176/rjfa/10-20-03
Rachmawati, S. (2020). Moderating effect of profitability on intellectual capital and real earnings management. The Accounting Journal of Binaniaga, 5(01), 33. https://doi.org/10.33062/ajb.v5i01.366
Sapir, E. V., & Karachev, I. A. (2020). Challenges of a new investment policy: Investment promotion and protection. Finance: Theory and Practice, 24(3), 118–131. https://doi.org/10.26794/2587-5671-2020-24-3-118-131
Saputra, I. (2020). the Influence of Environmental Performance, Organizational Reputation, Environmental Disclosure and Environmental Strategy on Bussiness Performance. International Journal of Contemporary Accounting, 2(2), 173. https://doi.org/10.25105/ijca.v2i2.8273
Swartz, N., & Firer, S. (2005). Board structure and intellectual capital performance in South Africa. Meditari Accountancy Research, 13(2), 145–166. https://doi.org/10.1108/10222529200500017
Tejerina-Gaite, F., & Fernández-Temprano, M. (2020). The influence of board experience on firm performance: does the director’s role matter? Journal of Management and Governance, 0123456789. https://doi.org/10.1007/s10997-020-09520-2
Vu, Nguyen, Ho, & Vuong. (2019a). Determinants of Vietnamese Listed Firm Performance: Competition, Wage, CEO, Firm Size, Age, and International Trade. Journal of Risk and Financial Management, 12(2), 62. https://doi.org/10.3390/jrfm12020062
Vu, T.-H., Nguyen, V.-D., Ho, M.-T., & Vuong, Q.-H. (2019b). Determinants of Vietnamese Listed Firm Performance: Competition, Wage, CEO, Firm Size, Age, and International Trade. Journal of Risk and Financial Management, 12(2), 62. https://doi.org/10.3390/jrfm12020062
Williams, C. C., & Kedir, A. M. (2016). THE impacts of corruption on firm performance: Some lessons from 40 African countries. Journal of Developmental Entrepreneurship, 21(4), 1–18. https://doi.org/10.1142/S1084946716500229
Al-Gamrh, B., Ku Ismail, K. N. I., Ahsan, T., & Alquhaif, A. (2020). Investment opportunities, corporate governance quality, and firm performance in the UAE. Journal of Accounting in Emerging Economies, 10(2), 261–276. https://doi.org/10.1108/JAEE-12-2018-0134
Ashyrov, G., & Akuffo, I. N. (2020). Dimension of corruption and firm performance: an empirical analysis from BEEPS survey. International Journal of Social Economics, 47(3), 384–403. https://doi.org/10.1108/IJSE-08-2019-0476
Braendle, U., Stiglbauer, M., Ababneh, K., & Dedousis, E. (2020). The impact of board diversity on firm performance – The case of Germany. Corporate Ownership and Control, 17(2), 183–193. https://doi.org/10.22495/cocv17i2art15
Brahma, S., Nwafor, C., & Boateng, A. (2020). Board gender diversity and firm performance: The UK evidence. International Journal of Finance and Economics, July. https://doi.org/10.1002/ijfe.2089
Certo, S. T., Lester, R. H., Dalton, C. M., & Dalton, D. R. (2006). Top management teams, strategy and financial performance: A meta-analytic examination. Journal of Management Studies, 43(4), 813–839. https://doi.org/10.1111/j.1467-6486.2006.00612.x
Coonjohn, B. J. J., & Approaches, C. A. (2011). Developing a Strategic Implementation Plan for Anti-Corruption 1.
Deegan, C. (2002). Introduction: The legitimising effect of social and environmental disclosures – a theoretical foundation. Accounting, Auditing & Accountability Journal, 15(3), 282–311. https://doi.org/10.1108/09513570210435852
Devi, S., Warasniasih, N. M. S., & Masdiantini, P. R. (2020). The Impact of COVID-19 Pandemic on the Financial Performance of Firms on the Indonesia Stock Exchange. Journal of Economics, Business, & Accountancy Ventura, 23(2), 226–242. https://doi.org/10.14414/jebav.v23i2.2313
Doh, J., Rodriguez, P., Uhlenbruck, K., Collins, J., & Eden, L. (2003). Coping with corruption in foreign markets - Executive Commentary. Academy of Management Executive, 17(3), 128–129. https://doi.org/10.5465/ame.2003.10954781
Etxeberria, I., & Odriozola, M. (2018). The social reputation of European companies: Does anti-corruption disclosure affect stakeholders’ perceptions? Corporate Social Responsibility and Environmental Management, 25(5), 713–721. https://doi.org/10.1002/csr.1488
Fama, E. F., & French, K. R. (1998). Taxes, Financing Decisions, and Firm Value. The Journal of Finance. The Journal of Finance, 53(3), 819–843.
Fernández-Temprano, M. A., & Tejerina-Gaite, F. (2020). Types of director, board diversity and firm performance. Corporate Governance (Bingley), 20(2), 324–342. https://doi.org/10.1108/CG-03-2019-0096
Fitria, G. N. (2021). The Effect of Management Accounting System, Sustainable Leadership and Environmental Strategy on Business Performance with Organizational Culture as Moderator. International Journal of Contemporary Accounting, 3(1), 45–60.
Freeman, R. E. (1984). Books. Cambridge University Press.
Golubeva, O. (2021). Firms’ performance during the COVID-19 outbreak: international evidence from 13 countries. Corporate Governance (Bingley). https://doi.org/10.1108/CG-09-2020-0405
Hambrick, D. C., & Mason, P. . (1984). Upper Echelon: The organisation as a reflection of its top managers. The Academy of Management Review, 16(1), 20–36. https://doi.org/10.1057/s41310-019-00054-0
Hess, D. (2009). Catalyzing corporate commitment to combating corruption. Journal of Business Ethics, 88(SUPPL. 4), 781–790. https://doi.org/10.1007/s10551-009-0322-7
Hills, G., Fiske, L., & Mahmud, A. (2009). Anti-corruption as Strategic CSR : A call to action for corporations. May, 1–52. www.ethics.org/files/u5/AnticorruptionFINAL.%5Cnpdf.%5CnHoi, Y.H., Lin, C.Y., 2012.
Joseph, C., Gunawan, J., Sawani, Y., Rahmat, M., Avelind Noyem, J., & Darus, F. (2016). A comparative study of anti-corruption practice disclosure among Malaysian and Indonesian Corporate Social Responsibility (CSR) best practice companies. Journal of Cleaner Production, 112, 2896–2906. https://doi.org/10.1016/j.jclepro.2015.10.091
Kalyuzhnova, Y., & Belitski, M. (2019). The impact of corruption and local content policy in on firm performance: Evidence from Kazakhstan. Resources Policy, 61(January), 67–76. https://doi.org/10.1016/j.resourpol.2019.01.016
Kells, S. (2020). Impacts of COVID-19 on corporate governance and assurance, international finance and economics, and non-fiction book publishing: some personal reflections. Journal of Accounting and Organizational Change, 16(4), 629–635. https://doi.org/10.1108/JAOC-08-2020-0115
Koentjaraningrat. (2002). Manusia dan Kebudayaan di Indonesia. Djambatan.
Lange, D. (2008). A multidimensional conceptualization of organizational corruption control. Academy of Management Review, 33(3), 710–729. https://doi.org/10.5465/AMR.2008.32465742
Lo, F. Y., Wang, Y., & Zhan, W. (2020). Does TMT cultural diversity contribute to firm performance and do socialisation and tenure matter? A test of two competing perspectives. Personnel Review, 49(1), 324–348. https://doi.org/10.1108/PR-11-2018-0468
Majeed, A., & Ahmed, S. (2018). Does Cultural diversity of Board of Directors and Audit Committee Dynamics Affect Firm Performance? Evidence from Firms in Karachi Meezan Index. Journal of Islamic Business and Management (JIBM), 8(2), 465–479. https://doi.org/10.26501/jibm/2018.0802-008
Mazur, B., & Bialostocka, P. (2010). Cultural diversity in feminist therapy: Theory and practice. Journal of Intercultural Management, 2(2), 5–15. https://doi.org/10.1037/10501-007
Mehmood, R., Hunjra, A., & Chani, M. (2019). The Impact of Corporate Diversification and Financial Structure on Firm Performance: Evidence from South Asian Countries. Journal of Risk and Financial Management, 12(1), 49. https://doi.org/10.3390/jrfm12010049
Mir-Babayev, R., Gulaliyev, M., Shikhaliyeva, S., Azizova, R., & Ok, N. (2017). The impact of cultural diversity on innovation performance: Evidence from construction industry of Azerbaijan. Economics and Sociology, 10(1), 78–93. https://doi.org/10.14254/2071-789X.2017/10-1/6
Nederveen, A., Knippenberg, D., & Dierrerdonck, D. (2013). Cultural diversity and team performance: The role of team member goal orientation. Academy of Management Journal, 56(3), 782–804. https://doi.org/10.5465/amj.2010.0992
Nnaoma, F., & Omotosho, O. (2017). Impact of Corporate Social Responsibility on the Performance of Manufacturing Firms in Nigeria. European Journal of Business and Management, 9, 94–129. https://doi.org/10.20431/2349-0349.0807001
Nobanee, H., Atayah, O. F., & Mertzanis, C. (2020). Does anti-corruption disclosure affect banking performance? Journal of Financial Crime, 27(4), 1161–1172. https://doi.org/10.1108/JFC-04-2020-0047
O’Higgins, E. (2006). Corruption, Underdevelopment, and Extractive Resource Industries: Addressing the Vicious Cycle. Business Ethics Quarterly, 16(2), 235–254. https://doi.org/10.1017/s1052150x00012823
Osuji, O. (2011). Fluidity of Regulation-CSR Nexus: The Multinational Corporate Corruption Example. Journal of Business Ethics, 103(1), 31–57. https://doi.org/10.1007/s10551-011-0840-y
Pandiangan, R., & Murwaningsari, E. (2019). Liquidity Moderating the Effect of Production Resources, Investment Decisions and Corporate Social Responsibility on Corporate Performance. Research Journal of Finance and Accounting, 10(20), 33–42. https://doi.org/10.7176/rjfa/10-20-03
Rachmawati, S. (2020). Moderating effect of profitability on intellectual capital and real earnings management. The Accounting Journal of Binaniaga, 5(01), 33. https://doi.org/10.33062/ajb.v5i01.366
Sapir, E. V., & Karachev, I. A. (2020). Challenges of a new investment policy: Investment promotion and protection. Finance: Theory and Practice, 24(3), 118–131. https://doi.org/10.26794/2587-5671-2020-24-3-118-131
Saputra, I. (2020). the Influence of Environmental Performance, Organizational Reputation, Environmental Disclosure and Environmental Strategy on Bussiness Performance. International Journal of Contemporary Accounting, 2(2), 173. https://doi.org/10.25105/ijca.v2i2.8273
Swartz, N., & Firer, S. (2005). Board structure and intellectual capital performance in South Africa. Meditari Accountancy Research, 13(2), 145–166. https://doi.org/10.1108/10222529200500017
Tejerina-Gaite, F., & Fernández-Temprano, M. (2020). The influence of board experience on firm performance: does the director’s role matter? Journal of Management and Governance, 0123456789. https://doi.org/10.1007/s10997-020-09520-2
Vu, Nguyen, Ho, & Vuong. (2019a). Determinants of Vietnamese Listed Firm Performance: Competition, Wage, CEO, Firm Size, Age, and International Trade. Journal of Risk and Financial Management, 12(2), 62. https://doi.org/10.3390/jrfm12020062
Vu, T.-H., Nguyen, V.-D., Ho, M.-T., & Vuong, Q.-H. (2019b). Determinants of Vietnamese Listed Firm Performance: Competition, Wage, CEO, Firm Size, Age, and International Trade. Journal of Risk and Financial Management, 12(2), 62. https://doi.org/10.3390/jrfm12020062
Williams, C. C., & Kedir, A. M. (2016). THE impacts of corruption on firm performance: Some lessons from 40 African countries. Journal of Developmental Entrepreneurship, 21(4), 1–18. https://doi.org/10.1142/S1084946716500229
Published
2021-08-31
How to Cite
WIDIYATI, Dian; MURWANINGSARI, Etty.
Anti-Corruption Disclosure, Investment Policy and Cultural Diversity on Firm Performance: Does the Board Experience Matter?.
International Journal of Advanced Research in Economics and Finance, [S.l.], v. 3, n. 3, p. 22-37, aug. 2021.
ISSN 2682-812X.
Available at: <https://myjms.mohe.gov.my/index.php/ijaref/article/view/14583>. Date accessed: 18 jan. 2025.
Section
English Section
