Citation:

Barnabas Tridig Silaban, Sinta Setiana, Tyara Angel Clarissa Tanujaya. "The Supervisory Board Size, Independence, and Profitability" International Research Journal of Economics and Management Studies, Vol. 4, No. 5, pp. 192-196, 2025.

Abstract:

This investigation aims to verify the relationship between supervisory board size, independence, and profitability with firm size as the control variable. The population comprises the non-financial companies forming the KOMPAS 100 Index between 2017 and 2022. This study employs the quantitative approach; therefore, it applies (1) simple random sampling to take samples, where the Slovin formula determines the total samples, and (2) t-statistic for hypothesis verification of the coefficients of the pooling data regression model. After analyzing 30 firms as the samples, this research demonstrates a positive inclination of supervisory board size and independence toward profitability, effectively controlled by firm size. With two outcomes, this research recommends that the General Shareholders Meeting empower the external supervisory board to create better management performance reflected through increased profitability. As a requirement, the criteria for choosing the supervisory board must be based on various proficiencies to help top management overcome challenging issues.

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Keywords:

Agency Theory, Capital Market, Company Ability to Financially Profit, Resource Dependence Perspective, Top Managers.