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The purpose of this paper is to investigate whether independent directors and audit committees that are chaired by an independent director as required by the Jakarta Stock Exchange (JSX) affect the quality of reported earnings.

The paper uses both total discretionary accruals (DA) and earnings response coefficient (ERC) as the proxies for earnings quality. It runs multivariate regressions to examine the improvements in earnings quality after the firms meet the JSX requirements.

It is found that both DA and ERC improve significantly after firms acquire independent directors and independent audit committees. Lower DA occurs in the first and second years after the firms meet the JSX requirements. There is an improvement in ERC in the first years after firms meeting the requirements.

The results suggest that independent directors and audit committees do improve earnings quality.

This is the first paper that compares the quality of earnings before and after firms acquire independent directors and independent audit committees. This methodology allows us to examine the impact of meeting JSX independence requirements on earnings quality. The findings contribute to the literature by showing the importance of having independent directors and an independent audit committee in order to improve earnings quality. These findings are specifically important for the capital market regulatory bodies, the shareholders, and the boards of directors, and for other users of financial reports in general.

The purpose of this paper is to investigate whether corporate governance practices and the quality of reporting are associated with firm value for public firms in Indonesia.

The authors hypothesize that there are positive associations between firm value and corporate governance practices and reporting quality. For the authors’ proxies for corporate governance and reporting quality they develop two new indices. First, they develop a corporate governance index (the CGI) to measure corporate governance practices by Indonesian firms. Second, they develop a reporting quality index (the RQI) to measure the firms’ quality of reporting and disclosures. To examine the associations the authors run multivariate regressions of their proxies for firm value on the two indices.

Consistent with the first hypothesis, the paper finds positive associations between corporate governance and different proxies of firm value. These findings suggest that firms that implement better corporate governance have higher values. Contrary to the second hypothesis, the paper finds negative associations between reporting quality and the proxies for firm value. These findings indicate that lower value firms tend to disclose more information that is consistent with the P3LKE than higher value firms.

The results suggest that corporate governance practice by Indonesian public firms is value relevant and therefore, should provide incentives to the firms to improve their governance. This shows that the Indonesian government's efforts to promote corporate governance provide benefits to publicly traded firms. The results also indicate that firms with low values are more likely to disclose information that is consistent with the P3LKE. This warrants further research because this finding is inconsistent with the contention that more disclosures should result in higher value.

The authority needs to put more efforts in promoting good corporate governance implementations and making sure that public firms improve their disclosures and reporting quality in order to provide benefits to the users of financial information.

Corporate governance index for public firms is not readily available in Indonesia. Therefore, the authors develop an index to measure corporate governance implementations by Indonesian public firms. To the authors’ knowledge, this is the first paper that develops an index to measure adherence to the P3LKE, which is a comprehensive measure of the quality of reporting.

The authors examine the role of stock liquidity in CEO equity compensation design. For a sample of publicly traded firms from 2007 to 2020, the authors find that greater stock liquidity is associated with a higher proportion of stock awards relative to the proportion of options in CEO equity compensation. The results of this study suggest that stock price informativeness on the grant date has a differential effect on the preference for the type of equity compensation awarded to CEOs. The empirical results are supported by multivariate analyses using alternative measures of stock liquidity and a two-stage least squares (2SLS) specification that alleviates endogeneity concerns. Furthermore, the authors document that the firm-specific increase in the proportion of stock awards compared to the proportion of stock options is associated with a firm-specific increase in stock liquidity. Collectively, the analyses suggest that stock liquidity as a measure of stock price informativeness contributes to the choice of CEO equity compensation design.

The aim of this study is to provide a further understanding of how and when social media (SM) boosts firm performance (FP) by exploring the mediation role of business innovation capabilities (BI) and firm competitiveness (FC) in the link between SM and FP.

This study uses a quantitative approach using small and medium sized enterprises (SMEs) in emerging market as an empirical field of research. The population of this study is the management level of SMEs and professionals. This study surveyed 425 samples to get primary data for quantitative analysis. This study uses Smart PLS SEM version 3.3.2 to analyze the collected data.

This study found that SM directly and indirectly affects FP through BI and FC. Besides, BI and FC mediated the relationship between SM and FP.

The originality of this study lies in the operationalization of an unexplored integrated framework using SMEs in emerging market as an empirical field of research from the perspective of combination of diffusion of innovations theory and resource advantage theory. This study thus provides a new approach to the potential of SM for business innovation capabilities oriented toward sustainability. Drawing on the findings of this study, theoretical and managerial implications are proposed which may be of great interests to business practitioners, business owners, business directors and managers to operate their organizations efficiently through making optimal use of SM platforms.

The purpose of this paper is to investigate and test the role of religio-centric product strategy (RPS) in mediating the relationship among marketing innovativeness (MI), market sensing capability (MSC), customer relationship management capability (CRMC) and brand management capability (BMC) with marketing performance (MP) in a religious-based industry. This is in accordance with the conditions of Indonesian religious people and the increasing demand for Muslim fashion products.

This paper selected 330 small fashion businesses in Indonesia and tested the regressive relations of the 6 constructs.

The findings showed that MI, MSC, CRMC and BMC have a positive effect on RPS and RPS also has a positive effect on MP, so that RPS acts as mediation in the relationship among MI, MSC, CRMC and BMC with MP.

In-depth research on other dimensions of the role of antecedent variable of RPS, such as NPD capability, specialized marketing capability, resource reconfiguration marketing capability, architectural marketing capability and marketing resources that are interesting to discuss (Morgan, 2012), has not been done in research.

By examining the literature on dynamic capability, marketing strategy, entrepreneurship and business performance, this paper offers a unique analysis of dynamic marketing capability and its impact on product strategy and MP in religious-based industries.