Analysis of Corporate Governance Effect and Characteristics of Companies on the Existence of Risk Management Committee

Abstract

This study aims to analyze the influence of corporate governance and company characteristics on the existence of the Risk Management Committee (RMC) and type of RMC, whether separated and combined with the audit committee. Variables are broken down into independent commissioners, auditor reputation, market risk, leverage and company size. The statistical method for testing hypotheses is logistic regression analysis. Samples collected using random sampling are included in eighty manufacturing companies listed on the Stock Exchange for 2012-2017. This study uses agency theory, company legitimacy, and signal theory to explain the relationship between variables. This study shows that several independent variables have a positive effect on the existence of RMC, namely the size of the company. as well as the independent variables that positively influence the existence of a separate RMC are the size of the company.