Corporate Governance, Value Chain and Financial Performance: An Empirical Analysis in Indonesia’s SOEs

Abstract

The role of State-Owned Enterprises is to contribute to the national economics based on the principles of economic democracy and has a very important role in the implementation of the national economy in order to realize the welfare of society as mandated by Constitution. In facts Indonesia’s State Owned Enterprises (SOEs) has a huge assets with still lower return on assets. This paper aims to explore the relationship between  corporate governance and value chain and Its impact to financial performance of  Indonesia’s SOEs. Data collects from 350 managers from SOEs s and applying ordinary least square,  Respondents come from 57 (fifty seven) SOEs in three big province that represents more than 75% SOEs. These  results indicate that corporate governance has a positive significant effects to value chain and corporate governance and value chain has no significants impact to financial performance of SOEs.