Independent director, independent commissioner, product market competition, and firm performance

Enita Audina Irmalia, Khusnul Prasetyo

Research output: Contribution to journalArticlepeer-review


The purpose of this study is to examine the effect of the independent director and independent commissioners on firm performance with moderating variable of product market competition in manufacturing companies listed on the Indonesia Stock Exchange. This study used multiple linear regression models and Moderated Regression Analysis (MRA). Data were obtained from the company's financial and annual reports published in the period from 2014 to 2018. The dependent variable in this study is firm performance proxied by return on assets (ROA). Independent variables in this study are the independent director and independent commissioners. Moderating variable is product market competition proxied with 1-Herfindahl Hirschman Index. The results of this study showed that the proportion of independent director and independent commissioners have significant positive effect on firm performance. In a moderating relationship, product market competition does not significantly influence the relationship between independent directors and firm performance. However, the moderating relationship in product market competition reinforces the positive influence of the proportion of independent commissioner on firm performance. The results of this research are able to provide an overview of the influence of independent directors and independent commissioners on company performance with product market competition as a moderating variable.

Original languageEnglish
Pages (from-to)848-868
Number of pages21
JournalInternational Journal of Innovation, Creativity and Change
Issue number4
Publication statusPublished - 2020


  • Firm performance
  • Independent commissioners
  • Independent director
  • Product market competition


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