MAKASSAR – Implementing Good Corporate Governance (GCG) significantly
improves the financial performance of banking institutions, according to a
study conducted by Asriyana and Musseng. The research found that the positive
impact of corporate governance becomes even stronger when supported by
effective management of intellectual capital. The study, which involved
employees from several major banks in Makassar, was published in the International
Journal of Business and Applied Economics (IJBAE), Volume 5, Issue 3, in
2026.
The findings are particularly relevant as the banking industry faces
increasing competition and growing demands for transparency, accountability,
and sustainable business practices. Beyond financial resources, banks are now
expected to leverage intangible assets such as employee expertise,
organizational systems, innovation, and stakeholder relationships to maintain
competitiveness and achieve long-term growth.
The study involved employees from several banking institutions in Makassar,
including PT Bank Sulselbar, PT Bank Mandiri (Persero) Tbk, PT Bank Rakyat
Indonesia (Persero) Tbk, and PT Bank Negara Indonesia (Persero) Tbk. Using a
quantitative approach and the Partial Least Squares Structural Equation
Modeling (PLS-SEM) method, the researchers examined the relationships among
Good Corporate Governance, intellectual capital, and financial performance.
Before analyzing the structural relationships, the researchers conducted
validity and reliability tests. The results confirmed that all indicators met
the required standards, ensuring that the variables accurately represented the
concepts being measured.
Key Findings
- · Good Corporate Governance has a positive and significant effect on financial performance.
- · The path coefficient between GCG and financial performance reached 0.389, with a T-statistic of 4.782.
- · Intellectual capital strengthens the relationship between Good Corporate Governance and financial performance.
- · The indirect effect of GCG on financial performance through intellectual capital recorded a coefficient of 0.092 and a T-statistic of 2.774.
- · Good Corporate Governance and intellectual capital together explain 76.9 percent of the variation in financial performance.
- · Better implementation of governance principles leads to stronger financial outcomes.
The study found that applying key governance principles—including
transparency, accountability, responsibility, independence, and fairness—helps
increase investor confidence and reduce conflicts of interest between
management and shareholders. These improvements enable organizations to
allocate resources more efficiently and achieve stronger financial results.
The researchers also found that intellectual capital plays a critical role
in maximizing the benefits of Good Corporate Governance. Intellectual capital
includes human capital, organizational structures, operational systems, and
relationships with external stakeholders. Companies that effectively manage
these intangible assets are better positioned to implement governance
principles successfully and improve overall business performance.
According to Asriyana and Musseng, organizations that combine strong
governance practices with well-managed intellectual capital are more likely to
achieve higher operational efficiency, better decision-making quality, and
stronger value creation. These advantages contribute directly to improved
financial performance and organizational sustainability.
The findings also support the Resource-Based View theory, which argues that
competitive advantage is derived not only from physical assets but also from
intangible resources such as knowledge, employee competencies, innovation, and
organizational capabilities. In this context, intellectual capital serves as a
strategic resource that amplifies the positive effects of Good Corporate
Governance on financial performance.
Based on the results, the researchers recommend that banking institutions
continue strengthening governance practices while investing in intellectual
capital development through employee training, skills enhancement,
organizational innovation, and knowledge management initiatives. Such efforts
are expected to improve competitiveness and help banks adapt to increasingly
dynamic business environments.
Author Profiles
- Asriyana - Sekolah Tinggi Ilmu Ekonomi YPUP Makassar
- Musseng - Sekolah Tinggi Ilmu Ekonomi YPUP Makassar
Research Source
Asriyana & Musseng. (2026). The Influence of Good Corporate Governance on Financial Performance with Intellectual Capital as a Moderating Variable. International Journal of Business and Applied Economics (IJBAE), Vol. 5 No. 3, 2026, pp. 871–884.
DOI: https://doi.org/10.55927/ijbae.v5i3.30
Journal Website: https://journalijbae.my.id/index.php/ijbae
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