Corporate Governance And Financial Performance Of Banks In Indonesia After The Covid-19 Pandemic

Abstract

This study aims to analyze the effect of corporate governance mechanisms on the financial performance of banks in Indonesia during the post-COVID-19 pandemic recovery period from 2021 to 2024. Corporate governance mechanisms are proxied by the size of the board of directors, the proportion of independent commissioners, and the number of audit committees, while financial performance is measured using return on assets (ROA). This study uses a quantitative approach with multiple linear regression on 36 firm-year observations from nine conventional commercial banks listed on the Indonesia Stock Exchange. The test results show that corporate governance mechanisms simultaneously have a significant effect on ROA. Partially, the size of the board of directors has a positive and significant effect on financial performance, while the number of audit committees has a negative and significant effect. On the other hand, the proportion of independent commissioners does not show a significant effect on ROA. These findings indicate that the effectiveness of banking governance is not solely determined by the fulfillment of formal structures, but rather depends on the quality of functions and efficiency of supervision. This study provides empirical contributions to the literature on banking corporate governance in developing countries, particularly in the post-pandemic recovery phase, and serves as input for regulators and bank management in strengthening governance practices that are oriented towards performance, stability, and long-term sustainability.