CORPORATE GOVERNANCE STRUCTURE, DISCLOSURE AND INFORMATION ASYMMETRY IN INDONESIA BANKING INDUSTRY

Abstract

The proper implementation good corporate governance mechanisms in the company will increase the level of disclosure. The direct relationship between corporate governance and information asymmetry stated that the implementation of good corporate governance will lead to reduce information asymmetry. One of the most fundamental components to be considered in implementation of good corporate governance is the establishment of effective corporate hierarchy. The purposes of this study are to find out the effect of corporate governance structure on information asymmetry, to find out the effect of corporate governance structure on disclosure, and to find out the effect of disclosure on information asymmetry in Indonesia banking industry. This study used partial least square/ variance based statistical method, with descriptive analitical research method. At significance level (α) of 10% resulted that corporate governance structure has a significant impact on disclosure in Indonesia banking industry (corporate governance structure represented by the indicator of audit committee member and independen board commissioner) and disclosure has a significant impact on information asymmetry in Indonesia banking industry (disclosure represented by the indicator of percentage corporate governance items disclosed or as IPCG).