Title:
THE INFLUENCE OF INTERNAL AND EXTERNAL CORPORATE GOVERNANCE MECHANISMS ON FINANCIAL DISTRESS WITH LIQUIDITY AS AN INTERVENING VARIABLE

Authors:
Adji Suratman, Safitri Mintarsih and Choirul Anwar

Abstract:
This study aims to analyze and find new things about the influence of internal and external corporate governance mechanisms, namely the proportion of independent commissioners, audit committee educational background, managerial ownership, institutional ownership, and KAP size on financial distress in shipping sector companies listed on the Stock Exchange. Indonesia. In addition, this study also aims to determine whether liquidity can be used as a mediation in the model. This research is quantitative research with correlational method. The research population is shipping companies as many as 26 companies. Researched for 5 years period 2016-2020. The sample technique used is purposive sampling and the number of samples is 9 companies experiencing financial distress. The data processing and analysis technique used in this research is panel data regression using the E-views 10 application. The results of this study indicate that the internal and external mechanisms of corporate governance affect financial distress partially and simultaneously. Liquidity is a mediating variable for the relationship between the proportion of independent commissioners, managerial ownership and KAP size on financial distress. However, liquidity is not a mediating variable for the relationship between audit committee educational background and institutional ownership on financial distress.

Keywords:
Proportion of Independent Commissioners, Educational Background of the Audit Committee, Managerial Ownership, Institutional Ownership, KAP Size, Liquidity