Journal of Financial and Behavioural Accounting
Vol. 1 No. 2 (2021)

Determinant Factors of Founding-Family Firms’ Performance in Indonesia

Alex Johanes Simamora (Universitas Terbuka)

Article Info

Publish Date
19 Jan 2022


This research aims to examine the factors that moderate the effect of founding-family firms on performance. Moderating variables include firm reputation, risk-taking behavior, agency costs of managers-shareholders, and agency costs of majority-minority shareholders. Firms' performance includes accounting-based and market-based performance. This research uses 412 manufacturing firm-years listed on the Indonesian Stock Exchange as the research sample. The hypotheses test uses a random-effect regression as the main test and a common-effect regression test as an alternative test. Based on data analysis, firm reputation, risk-taking behavior, agency costs of mangers-shareholders, and agency costs of majority-minority shareholders moderates the effect of the founding family on performance. It indicates that founding-family firms can achieve higher performance if they promote a higher firm reputation, lower risk-taking behavior, and lower agency costs. This research fills the previous findings gap of performance in the founding-family firms. This research captures when founding-family firms can improve performance or experience performance reduction. To the best of the author's knowledge, this research is also the first research that provides a comprehensive picture of determinant factors of founding-family firms' in Indonesia.

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Journal Info





Decision Sciences, Operations Research & Management Economics, Econometrics & Finance Social Sciences


Journal of Financial and Behavioural Accounting is a blind-reviewed academic journal published by LPPM Universitas Terbuka, which receives articles periodically twice a year (April and September). JFBA publishes papers in the field of accounting and finance which have a significant contribution to ...