The International Journal of Accounting and Business Society
Vol. 27, No. 2 August 2019
© Centre for Indonesian Accounting and Management Research
Postgraduate Program, Brawijaya University
1
BOARD OF DIRECTOR’S CHARACTERISTICS, INTELLECTUAL CAPITAL,
AND BANK PERFORMANCE
An empirical examination of Indonesian Banking Sector
Annisa Hilmy Rositha
1*
, Nila Firdausi
2
, and Ari Darmawan
2
1
Master Program of Business Administration, University of Brawijaya, Malang,
Indonesia
2
Department of Business Administration, Faculty of Administrative Sciences,
University of Brawijaya,
Malang, Indonesia
Abstract
The purpose of this study t o examine the effect of board of director’s characteristics that
formed by proportion of independent directors, proportion of women directors, number
of the board of directors, and frequency of board meeting on intellectual capital and bank
performance. This study also examine the effect of intellectual capital on bank
performance. This research applies explanatory research with a quantitative approach.
The data derived from secondary bank annual report data. The total sample consisted of
12 Indonesian Conventional Banks for a period of 3 years ranging from 2015 to 2017.
Partial Least Square (PLS) Analysis is used to analyze the collected data. The results of
this study indicated that the board of director’s characteristics has a positive and
significant influence on intellectual capital. This finding provides a recent insight that the
background of the board of directors depicted through the presence of independent
directors and female directors on the board of directors has a positive impact on the
performance of the company's intellectual capital. Further testing, the board of director’s
characteristics has a positive and significant influence on bank performance. The results
of this study indicate that the number of board of directors, the presence of female
directors and independent directors, and the frequency of board of directors' meetings in