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Examining the effect of diversification, corporate governance and intellectual capital on sustainability performance

Author

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  • Nurul Fajriyanti

    (Accounting Departement, Faculty of Economics and Business, University of Brawijaya, Indonesia)

  • Eko Ganis Sukoharsono

    (Accounting Departement, Faculty of Economics and Business, University of Brawijaya, Indonesia)

  • Noval Abid

    (Accounting Departement, Faculty of Economics and Business, University of Brawijaya, Indonesia)

Abstract

This study aims to examine and analyze the effect of diversification, corporate governance and intellectual capital on sustainability performance, either directly or indirectly, by involving financial performance as a mediating variable. This study uses secondary data on Islamic Commercial Banks in Indonesia which are registered with the Financial Services Authority from 2011 - 2018, with a sample size of 10 Islamic banks that meet the criteria using the purposive sampling method so that 80 observations are obtained. Data is obtained from annual reports, sustainability reports, and reports on the implementation of good corporate governance. The data analysis technique used SEM-PLS with the help of WarpPLS 7.0 software. The results of the study provide empirical evidence that both the quality and quantity of corporate governance, intellectual capital and financial performance have a positive effect on sustainability performance. Key Words: Diversification, Corporate Governance, Intellectual Capital, Financial Performance and Sustainability Performance

Suggested Citation

  • Nurul Fajriyanti & Eko Ganis Sukoharsono & Noval Abid, 2021. "Examining the effect of diversification, corporate governance and intellectual capital on sustainability performance," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 10(2), pages 12-20, March.
    • Handle: RePEc:rbs:ijbrss:v:10:y:2021:i:2:p:12-20
    DOI: 10.20525/ijrbs.v10i2.1053
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    References listed on IDEAS

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    1. Indra Siswanti, 2017. "Sustainable Business of Islamic Bank Through on the Islamic Corporate Governance and Islamic Financial Performance," GATR Journals jfbr125, Global Academy of Training and Research (GATR) Enterprise.
    2. Higgins, Robert C & Schall, Lawrence D, 1975. "Corporate Bankruptcy and Conglomerate Merger," Journal of Finance, American Finance Association, vol. 30(1), pages 93-113, March.
    3. Kock, Carl J & Guillen, Mauro F, 2001. "Strategy and Structure in Developing Countries: Business Groups as an Evolutionary Response to Opportunities for Unrelated Diversification," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 10(1), pages 77-113, March.
    4. Indra Siswanti & Ubud Salim & Eko Ganis Sukoharsono & Siti Aisjah, 2017. "The Impact of Islamic Corporate Governance, Islamic Intellectual Capital and Islamic Financial Performance on Sustainable Business Islamic Banks," International Journal of Economics and Financial Issues, Econjournals, vol. 7(4), pages 316-323.
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    Cited by:

    1. Idris Gautama So & Hasnah Haron & Anderes Gui & Elfindah Princes & Synthia Atas Sari, 2021. "Sustainability Reporting Disclosure in Islamic Corporates: Do Human Governance, Corporate Governance, and IT Usage Matter?," Sustainability, MDPI, vol. 13(23), pages 1-23, November.

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