The Effect of the Employee Stock Ownership Program and Growth on Return On Equity (Case Studies in Manufacturing Companies Listed on the Indonesia Stock Exchange in 2015-2019)

Abstract

The purpose of this paper to examine the effect of ESOP and growth on financial performance. The financial performance used ROE method with dupont system. Financial performance is a description of Condition Company to assess profitability and return on equity. Financial performance can be influenced by many factors, that is ESOP and growth. The paper includes a conceptual as well as empirical analysis, in which data from a sample of listed manufactur firms for the period from 2011 to 2015. The method of this paper is descriptive and verifikatif, method to describe research variables and explain the relationship between variables with hypothesis testing. Data analysis technique is panel data model, use F test and T test.The result of study are the highest average ROE values ​​were in 2015 and 2016 and the lowest average ROE values ​​were in 2019. The average ESOP growth each year is the same. The highest average value of growth was in 2015 and the lowest average value of growth was in 2018. ESOP and Growth simultaneously have a significant effect on ROE. Partial effect of ESOP and Growth on ROE. ESOP has a significant negative effect on ROE. Growth has a negative and insignificant effect on ROE Future research can examine other variables, such as funding policies, ownership structures, intellectual capital and good corporate governance. Researchers can take samples in other sectors, such as financial and insurance sector, service sector, property sector, or industry sector also.