Governance and Risk Management of Indonesian Listed Companies
The purpose of this research is to examine the effect of corporate governance mechanism on the implementation of enterprise risk management of Indonesian public listed companies. By exploring the purposive sampling method, the 118 Indonesian public listed companies were selected as a sample of this study. This study found that the board size, complexity, and leverage positively influence the level of enterprise risk management system. This finding indicates that the companies with more persons sit as board members will more effective in implementing enterprise risk management systems. This finding implies that the indonesian capital market regulation should propose the regulation on the minimum member who sitting as board members in order to encourage management of Indonesian listed companies to effectively apply enterprise risk management system. Meanwhile, this study could not find empirical evidence on the influencing of independence board and audit committee on the level of enterprise risk management implementation.
Index Terms- Enterprise Risk Management, Corporate Governance, Board of Director, Audit Committee.