The Construction of Kekeluargaan as an Indonesia’s Organizational Culture

Indonesia has the largest economy in Southeast Asia and the seventh largest GDP in the world, yet little is known about Indonesia’s organizational culture. This paper develops a deep understanding of kekeluargaan (kinship), which derives from an anthropological and sociological epistemologies. The paper explores Javanese culture as the foundation of Indonesia’s business context. A qualitative and indigenous approach was designed to determine if the kekeluargaan norm exists in the Indonesian workplace today. Document analysis and semi-structured interviews were used to collect data. The findings show that the kekeluargaan norm acts as the foundation of Indonesia’s organisational culture; with, hormat (respect) and rukun (harmony). Three proposition are given to consider the importance of understanding kekeluargaan as a salient Indonesian organizational culture. The paper concludes managerial and theoretical implications to Indonesian business context

Founding Family Ownership and Firm Performance: Empirical Evidence From Consumer Goods Industry in Indonesia

This research investigates the significant influence of family ownership on firm performance in order to provide information to decision makers and other interested parties. The analysis includes comparisons between family and non-family firm performance in Indonesia. The samples are taken from 31 consumer goods companies, listed on the Indonesian Stock Exchange, ranging from 2005 to 2009. The results show that non-family firms perform better than family firms and no significant influence between family ownership and firms' profitability. On the other hand, family ownership has negative contribution to firm market valuation. The study suggests that family firms have lower financial performance than that of non-family. Family members within the top position have major control rights and contribute a negative influence to firm performance. The evidence raises concerns about possible profit manipulation and weak governance law in Indonesia, and as a result there is an expropriation of wealth to the majority and family related shareholders

The Degree of Company Vulnerability Using Altman Model: a Survey of Public Listed Companies in Indonesia

This research is purposed to analyze the degree of vulnerability of a company's performance. From the financial report produced, investor will analyze the level of its performance. There are several variables of defining the performances, in which they are used to distinguish the degree of vulnerability. This level of degree affects investor's decision on company's performance. The object of this research, after taking relevant data from years 2006- 2008 published annual financial reports, there are 184 public companies listed in Indonesian Stock Exchange that are qualified in the analysis procedure. The Altman (1993) model of Z-score formula is used to define variables reflecting in a company performance, in which is classified into three-zone index (safe zone, grey zone and distress zone). This research has found that more companies lie in the grey and distress zone. Amongst the safe zone companies are Mining Industry and the lowest degree is the Infrastructure Industry. Also, a trend of decreasing performance occurred during 2008. There are possible reasons that might result in the performance of the industries. This result of research will benefit for investors in considering investing in Indonesian companies

Effects of Corporate Governance Variables on Earnings Management in Indonesia

To determine the effects of corporate governance on earnings management, this paper analyzed 171 annualreports from issued 2006 to 2009 by 57 non-financial, joint stock companies implementing GCG (GoodCorporate Governance) practices, which were listed on the Indonesia Stock Exchange (IDX). Six corporategovernance variables (board composition, independent commissioners, separate chairman/CEO roles, auditcommittee, managerial share ownership, and audit quality) as well as three control variables (leverage, size,and ROA) were used. The results showed that two corporate governance variables significantly influencedearnings management practices (separate chairman/CEO roles and managerial share ownership); the othervariables had no effect because these companies used GCG practices only to follow regulations rather than tomonitor and control

Mapping the Terrain: An Indonesian Business Perspective of the ASEAN Economic Community

Research aims: This paper focuses on the institutions that the ASEAN Economic Community (AEC) project will affect. By employing institutional logics theory, this study scrutinizes academics and business practitioners as institutions and the cultural context embedded within them. Methodology: A mixed method of newspaper data analysis and semi-structured interviews was used to obtain comprehensive data from both sources. Research findings: The findings suggest a definite orientation gap between business practitioners, associations, and academics-the three groups have less information and contributions compared with the government and association influences. This study concludes that more participation is needed from these institutions, which are currently feeling "victimized" and excluded by the project. Originality: The originality of this paper lies in its application of institutional logics to business perspectives within an Indonesian context. The framework offers a holistic approach to how people are institutionalized based on their macro-, meso-, and micro-environments. Managerial implications in the Southeast Asian context: There has been a lack of communication and coordination amongst these institutions. Therefore, this study guides the related institutions and helps them to map their roles in enhancing the AEC project.   Research limitations and recommendations: This research has two limitations: 1) the lack of literature in this field, and 2) and the difficulty in accessing information from the government institutions. The paper offers avenues for further research: additional variables regarding Indonesian norms and values as well as a method for extending the research to other ASEAN members. &nbsp

Understanding Tax Amnesty and Tax Compliance in Indonesia: an Institutional Approach

This study was motivated by one of President Joko Widodo’s projects, which is to build better infrastructure in Indonesia. Tax amnesty is used as a way of receiving undeclared assets expecting that Indonesia revenues will increase. This study focuses on the perception of both tax consultants and taxpayers. The interview was conducted to explore the points of interest as it was being developed. The analysis was done using institutional theory, analysis and discussion on their behavior towards tax amnesty are given based on the result of the research. This research uses interpretivism perspective to examine the meaning created by a human that differentiate human from physical phenomena. The data were collected from secondary data, archival data and complemented with semi-structured interviews. The finding suggests three themes associated with institutionalization of taxpayer compliance, namely rules and regulation, political economy, and social powers. These themes generate pressures on coercive isomorphism, as well as normative isomorphism. The result suggests establishing synergy and a dialectical process between the tax authorities and the taxpayer in conducting coaching, monitoring and fair enforcing of law to support taxpayer compliance