Family control and corporate performance: the role of independent commissioners in reducing agency problems

Abstract

This study examines the influence of family control on firm performance, taking into consideration the moderating variable of the proportion of independent commissioners. The sample for this research consists of manufacturing sector companies listed on the Indonesia Stock Exchange (IDX) for the period 2012-2018, with 477 observations. Ordinary Least Squares (OLS) regression analysis and Moderated Regression Analysis (MRA) techniques were employed to test the hypotheses. The findings of this research indicate that family control has a significant negative impact on firm performance. Additionally, it was found that the proportion of independent commissioners significantly weakens the negative influence of family control on firm performance.