Abstract:
This study is focused on the Good Corporate Governance implementation in Indonesia banking industry. Therefore, this study emphasis on one main research question: ‘What is the influence of GCG towards banks’ performance in Indonesia commercial banking industry?’ In order to answer the main question, this study analyses twelve hypothesis related with the influence of Whistle Blowing System; the total member of Board of Director; the total member of Audit Committee; the independent member of Audit Committee; the total meeting of Board of Director; the total meeting of Audit Committee that represent as GCG variables; towards Net Interest Margin and Cost to Income Ratio as bank’s performance measurements, where NIM as a representative of bank’s profitability; and CIR as a representative of bank’s management efficiency. This study is a quantitative research with the secondary data that generated from annual report of ten (10) conventional banks and eleven (11) Islamic banks in Indonesia year 2015-2016. This study uses Panel Data Generalized Least Squares Regression by STATA M-64. The findings show that GCG has positive influence to increase bank’s management efficiency, however, only GCG measurements that related with AC have positive influence to increase bank’s profitability.
