Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups

A decade after the 1997/98 Asian Financial crisis, Indonesia is still experiencing a low score on the effectiveness of corporate governance enforcement. The problem of wealth expropriation still persists due to high ownership concentration, domination of business groups and predominantly family-cont...

Full description

Saved in:

Bibliographic Details
Main Author:	Harto, Puji
Format:	Thesis
Language:	English
Published:	2012
Subjects:	HD28-70 Management Industrial Management
Online Access:	http://eprints.usm.my/45939/1/PUJI%20HARTO_HJ.pdf
Tags:	Add Tag No Tags, Be the first to tag this record!

id	my-usm-ep.45939
record_format	uketd_dc
spelling	my-usm-ep.459392020-01-20T07:26:23Z Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups 2012-02 Harto, Puji HD28-70 Management. Industrial Management A decade after the 1997/98 Asian Financial crisis, Indonesia is still experiencing a low score on the effectiveness of corporate governance enforcement. The problem of wealth expropriation still persists due to high ownership concentration, domination of business groups and predominantly family-controlled firms. The overall objective of this study is to examine the role of corporate governance mechanisms and political connections to explain the extent of wealth expropriation through related party transactions. Related party transactions serves as a proxy for wealth expropriation and is examined from related lending, related borrowing, related party sales and related party purchases perspectives. The sample of this study was 127 public listed companies in the Indonesian Stock Exchange during the period of 1999-2008, resulted in 1270 firm-year observations. Dynamic panel data regression was used to test the hypotheses. The results of this study show that several internal governance mechanisms fail to discharge their monitoring role to wealth expropriation. Ultimate ownership structures and multiple directorships are more likely to support wealth expropriation. Director compensation and multiple commissionerships fail to act as effective monitoring mechanisms to curb wealth expropriation. Political connections tends to facilitate wealth expropriation and also acts as an impediment to the effectiveness of internal governance mechanisms. This research highlighted several contributions. 2012-02 Thesis http://eprints.usm.my/45939/ http://eprints.usm.my/45939/1/PUJI%20HARTO_HJ.pdf application/pdf en public phd doctoral Universiti Sains Malaysia Pusat Pengajian Pengurusan
institution	Universiti Sains Malaysia
collection	USM Institutional Repository
language	English
topic	HD28-70 Management Industrial Management
spellingShingle	HD28-70 Management Industrial Management Harto, Puji Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups
description	A decade after the 1997/98 Asian Financial crisis, Indonesia is still experiencing a low score on the effectiveness of corporate governance enforcement. The problem of wealth expropriation still persists due to high ownership concentration, domination of business groups and predominantly family-controlled firms. The overall objective of this study is to examine the role of corporate governance mechanisms and political connections to explain the extent of wealth expropriation through related party transactions. Related party transactions serves as a proxy for wealth expropriation and is examined from related lending, related borrowing, related party sales and related party purchases perspectives. The sample of this study was 127 public listed companies in the Indonesian Stock Exchange during the period of 1999-2008, resulted in 1270 firm-year observations. Dynamic panel data regression was used to test the hypotheses. The results of this study show that several internal governance mechanisms fail to discharge their monitoring role to wealth expropriation. Ultimate ownership structures and multiple directorships are more likely to support wealth expropriation. Director compensation and multiple commissionerships fail to act as effective monitoring mechanisms to curb wealth expropriation. Political connections tends to facilitate wealth expropriation and also acts as an impediment to the effectiveness of internal governance mechanisms. This research highlighted several contributions.
format	Thesis
qualification_name	Doctor of Philosophy (PhD.)
qualification_level	Doctorate
author	Harto, Puji
author_facet	Harto, Puji
author_sort	Harto, Puji
title	Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups
title_short	Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups
title_full	Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups
title_fullStr	Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups
title_full_unstemmed	Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups
title_sort	corporate governance and political connections on wealth expropriation among indonesian business groups
granting_institution	Universiti Sains Malaysia
granting_department	Pusat Pengajian Pengurusan
publishDate	2012
url	http://eprints.usm.my/45939/1/PUJI%20HARTO_HJ.pdf
_version_	1747821589417689088

Corporate Governance And Political Connections On Wealth Expropriation Among Indonesian Business Groups

Similar Items