The influence of good corporate governance on financial distress

摘要

This study aims to analyze the influence of good corporate governance (GCG) on financial distress. This study also aims to create a bankruptcy prediction model by using historical data from non-financial sector companies listed on Indonesia Stock Exchange (IDX) over the period of 2011 - 2015. This study used quantitative approach by using logistic regression. The final sample used in this study were 337 companies with 1,685 years observation. The study findings suggest that the proportion of independent outside directors, audit opinion, size, and ownership type from the category of good corporate governance are incorporated into the model. All the variables are significant. The results suggest that the accuracy of this bankruptcy prediction model was 99.7%.