Ownership Structure and Financial Restatement in Emerging Markets: A Study from Indonesia

Ni Wayan Rustiarini, Ni Made Sunarsih and Putu Diah Kumalasari

Economic Studies journal, 2025, issue 4, 80-97

Abstract: Financial restatements have been shown to cause anxiety among capital market players due to perceived weaknesses in corporate governance oversight, especially in developing countries. An effective ownership structure can fortify corporate governance, particularly in nations where a robust legal framework is yet to be established, such as Indonesia. The primary focus of this study is to investigate the influence of managerial ownership, institutional ownership, public ownership, and concentrated ownership in financial restatements. The study examines manufacturing firms listed on the Indonesia Stock Exchange over the period 2017 to 2021, employing logistic regression for data analysis. The study reveals that managerial ownership does not exert a significant influence on financial restatements. In contrast, both institutional ownership and public ownership are found to have a negative correlation with financial restatements. Furthermore, the existence of concentrated ownership is associated with a decreased likelihood of financial restatements.

JEL-codes: G32 M40 M41 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:bas:econst:y:2025:i:4:p:80-97

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