UNPACKING VALUE: HOW BUSINESS STRATEGY, OWNERSHIP, AND PERFORMANCE SHAPE STOCK PRICES OF LQ45 MANUFACTURING FIRMS (2019–2023)
DOI:
https://doi.org/10.15575/aksy.v7i2.45825Keywords:
Business Strategy, Corporate Performance, Strategic Decision, Stock PriceAbstract
This study examines the interplay between business strategy, corporate performance, and managerial ownership in shaping the stock prices of LQ45listed manufacturing firms in Indonesia from 2019 to 2023. Despite analogous financial metrics, it addresses persistent valuation asymmetries between StateOwned Enterprises (SOEs) and nonSOEs. An integrativecomparative analytical framework is developed, positioning ownership structure as a moderating variable within the dynamics of an emerging market. Employing a quantitative methodology, the study applies panel data regression to test directional causality across key indicators, including Asset Utilisation Efficiency (AUE), Return on Equity (ROE), Return on Assets (ROA), Earnings per Share (EPS), and the proportion of managerial ownership. The empirical workflow comprises five sequential stages: (1) computation of financial ratios, (2) strategic categorisation via quintile scoring, (3) regressionbased model estimation, (4) diagnostic testing for normality (Kolmogorov–Smirnov) and heteroskedasticity, and (5) comparative testing moderated by ownership classification. Findings reveal AUE as a statistically significant determinant of stock price behaviour, while corporate performance and managerial ownership exhibit relatively weaker isolated effects. The study offers strategic insights for capital market actors and public sector stakeholders navigating valuation complexities in the postpandemic era.
References
Afifudin, M., & Sari, R. N. (2020). Pengaruh karakteristik dewan komisaris terhadap pengungkapan tanggung jawab sosial perusahaan. Jurnal Akuntansi Multiparadigma, 11(2), 235–252. https://doi.org/10.18202/jamal.2020.08.11203
Alqatamin, R. M., & AlTarawneh, M. M. (2020). Audit committee effectiveness and accounting conservatism: Evidence from Jordan. Cogent Business & Management, 7(1), 1723514. https://doi.org/10.1080/23311975.2020.1723514
Bentley, K. (2013). Strategic management and shareholder value. Journal of Business Strategy, 34(2), 28–34.
Chi, J., & Gupta, M. (2009). The role of ownership structure in firm performance: Evidence from China. The Journal of Multinational Financial Management, 19(1), 15–34.
Datta, S., IskandarDatta, M., & Raman, K. (2005). Managerial stock ownership and the maturity structure of corporate debt. The Journal of Finance, 60(5), 2333–2350.
Denis, D. K., & McConnell, J. J. (2003). International corporate governance. Journal of Financial and Quantitative Analysis, 38(1), 1–36.
El Fadil, A. M., Hacini, I., & Benyoussef, M. (2020). Impact of corporate performance on stock price predictions: Evidence from emerging markets. Journal of Economic and Financial Analysis, 12(4), 101–118.
Financial Services Authority (OJK). (2022). "Annual Report of Indonesia's Capital Market." Retrieved from https://www.ojk.go.id
Gerged, A. M., Albitar, K., & AlHaddad, L. M. (2021). Corporate environmental disclosure and earnings management—The moderating role of corporate governance structures. International Journal of Finance & Economics, 26(3), 4789–4810. https://doi.org/10.1002/ijfe.2007
Habib, A., & Hasan, M. M. (2024). Business strategy, overvalued equities, and stock price crash risk. School of Accountancy, Massey University; School of Economics and Finance, Curtin University.
Habib, A., & Mostafa, M. (2017). Bad news hoarding and the risk of stock price crash. Journal of Financial Economics, 126(2), 270–292.
Handoyo, S., Suharman, H., Ghani, E. K., & Soedarsono, S. (2024). A business strategy, operational efficiency, ownership structure, and manufacturing performance: The moderating role of market uncertainty and competition intensity and its implication on open innovation. Faculty of Economics and Business, Universitas Padjadjaran.
Hanif, M. I., & Arifah, S. (2023). Corporate social responsibility dan kualitas laba: Perspektif moderasi efektivitas komite audit. Jurnal Ilmu Akuntansi dan Bisnis Syariah, 5(1), 45–58. https://doi.org/10.24042/jiabs.v5i1.12345
Higgins, C., Omer, T. C., & Phillips, J. D. (2015). "The Influence of a Firm's Business Strategy on Its Tax Aggressiveness." Contemporary Accounting Research, 32(2), 674–702.
Houmes, R., & Skantz, T. (2010). "Corporate Transparency and Stock Price Valuation: An Analysis of Ownership Structure and Market Perception." Journal of Financial Economics, 96(1), 99–123.
Hsiao, C. (2007). "Panel Data Analysis—Advantages and Challenges." Test, 16(1), 1–22.
Huang, C., & Jin, Z. (2024). "Share Repurchase and Stock Price Synchronicity." China Journal of Accounting Studies. https://doi.org/10.1080/21697213.2024.2336090
Indonesia Stock Exchange (IDX). (2023). "LQ 45 Index Constituents." Retrieved from https://www.idx.co.id
Jensen, M. C. (2005). "Agency Costs of Overvalued Equity." Financial Management, 34(1), 519.
Jensen, M. C., & Meckling, W. H. (1976). "Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure." Journal of Financial Economics, 3(4), 305–360.
Jizi, M. I. (2017). The influence of board composition on sustainable development disclosure. Business Strategy and the Environment, 26(5), 640–655. https://doi.org/10.1002/bse.1943
Khan, H. A. U., Muttakin, M. B., & Siddiqui, J. (2022). Corporate social responsibility disclosures and earnings quality: Does family ownership matter? Journal of Business Research, 139, 553–563. https://doi.org/10.1016/j.jbusres.2021.10.055
Krismiaji, Subekti, I., & Lu, Y. (2023). Earnings management and corporate social responsibility: The role of governance and institutional environment. Asian Review of Accounting, 31(3), 462–484. https://doi.org/10.1108/ARA0120220011
Li, Q., Liu, X., Chen, J., & Wang, H. (2022). "Does Stock Market Liberalization Reduce Stock Price Synchronicity? — Evidence from the ShanghaiHong Kong Stock Connect." International Review of Economics and Finance, 77, 25–38. https://doi.org/10.1016/j.iref.2021.09.004
Luo, L., Tang, Q., & Lan, Y. C. (2013). Comparison of the propensity for carbon disclosure between developing and developed countries. Accounting Research Journal, 26(1), 6–34. https://doi.org/10.1108/ARJ0420120020
March, J. G. (1991). "Exploration and Exploitation in Organizational Learning." Organization Science, 2(1), 7187.
McKinsey & Company. (2022). "The Role of Business Strategies in Shaping Market Performance." Retrieved from https://www.mckinsey.com
Miles, R. E., & Snow, C. C. (1978). Organizational Strategy, Structure, and Process. McGrawHill.
Miller, D. (1990). The Icarus Paradox: How Exceptional Companies Bring About Their Own Downfall. HarperBusiness.
Mohamed, E. A., Ahmed, I. E., Mehdi, R., & Hussain, H. (2020). "Impact of Corporate Performance on Stock Price Predictions in the UAE Markets: NeuroFuzzy Model."
Mohamed, E. A., El Fadil, M., Hacini, I., & Benyoussef, M. (2020). "The Role of Corporate Governance in Stock Price Prediction." The Journal of Applied Business Research, 36(3), 203–217.
Morck, R., Shleifer, A., & Vishny, R. W. (1988). "Management Ownership and Market Valuation: An Empirical Analysis." Journal of Financial Economics, 20, 293315.
Nurfadilah, I., & Dewi, K. (2022). Pengaruh struktur kepemilikan terhadap manajemen laba pada perusahaan manufaktur di Indonesia. Jurnal Ilmu Akuntansi dan Bisnis Syariah, 4(2), 89–100. https://doi.org/10.24042/jiabs.v4i2.9876
Pratiwi, A. K., & Nugroho, R. (2019). Pengaruh good corporate governance terhadap nilai perusahaan. Jurnal Riset Akuntansi dan Keuangan, 7(3), 412–426. https://doi.org/10.17509/jrak.v7i3.14732
Oh, W. Y., Chang, Y. K., & Martynov, A. (2011). The effect of ownership structure on corporate social responsibility: Empirical evidence from Korea. Journal of Business Ethics, 104(2), 283–297. https://doi.org/10.1007/s105510110912z
Parnell, J. A. (2011). Strategic Management: Theory and Practice. SAGE Publications.
Porter, M. E. (1980). Competitive Strategy: Techniques for Analyzing Industries and Competitors. Free Press.
Puspitaningtyas, Z. (2017). "Is Financial Performance Reflected in Stock Prices?" Department of Business Administration, University of Jember, Jember, Indonesia.
Rezaee, Z. (2016). Business sustainability: Performance, compliance, accountability and integrated reporting. Journal of Accounting and Finance, 16(2), 25–35.
Rodrigue, M., Magnan, M., & Boulianne, E. (2013). Stakeholders’ influence on environmental strategy and performance indicators: A managerial perspective. Management Accounting Research, 24(4), 301–316. https://doi.org/10.1016/j.mar.2013.06.004
Rudiawarni, Agustia, & Tjahyadi, B. (2022). "Business Strategy and Industrial Competition: The Case of Manufacturing Companies."
Tee, C. M. (2017). "Political Connections, Institutional Investors Monitoring and Stock Price Synchronicity: Evidence from Malaysian Firms." Managerial Finance, 43(11), 1236–1253. https://doi.org/10.1108/MF0320170099
Treacy, M., & Wiersema, F. (1995). The Discipline of Market Leaders: Choose Your Customers, Narrow Your Focus, Dominate Your Market. AddisonWesley.
Wang, Z., Sun, Z., ShengXian Teo, B., & Teo, X. (n.d.). "Literature Review on the Impact of Corporate ESG Performance on Corporate Value." Journal of Innovation and Development, Vol. 2, Issue 2.
Wen, H., Zhong, Q., & Lee, C.C. (2024). "A Business Strategy, Operational Efficiency, Ownership Structure, and Manufacturing Performance: The Moderating Role of Market Uncertainty and Competition Intensity and Its Implication on Open Innovation." Research Center of the Central China for Economic and Social Development, Nanchang University, Nanchang 330031, China; School of Economics and Management, Nanchang University, Nanchang 330031, China; School of Finance, Zhongnan University of Economics and Law, Wuhan 430073, China.
Willis, V. F. (2016). "A Model for Teaching Technology: Using Excel in an Accounting Information Systems Course." Journal of Accounting Education, 36, 8799.
Wooldridge, J. M. (2010). Econometric Analysis of Cross Section and Panel Data. MIT Press.
World Bank. (2021). "The Impact of COVID19 on Global Financial Markets." Retrieved from https://www.worldbank.org
Yermack, D. (1996). "Higher Market Valuation of Companies with a Small Board of Directors." Journal of Financial Economics, 40(2), 185–211.
Yu, E. P. Y., Van Luu, B., & Chen, C. H. (2018). Greenwashing in environmental, social and governance disclosures. Research in International Business and Finance, 44, 281–296. https://doi.org/10.1016/j.ribaf.2017.07.012
Yuliana, L., & Wicaksono, I. (2021). Pengaruh CSR terhadap kinerja keuangan perusahaan. Jurnal Ekonomi dan Bisnis Indonesia, 36(1), 65–80. https://doi.org/10.22146/jieb.123456
Zahra, S. A., & Pearce, J. A. (1989). "Boards of Directors and Corporate Financial Performance: A Review and Integrative Model." Journal of Management, 15(2), 291334.
Zamani, M., & Saeedi, P. (2013). "Business Strategy Typologies and Performance: A Case Study of Iranian Manufacturing Companies." Journal of Strategy and Management, 6(1), 4–16.
Book References
Anthony, R. N., & Govindarajan, V. (2007). Management control systems (12th ed.). McGrawHill Education.
Drury, C. (2018). Management and cost accounting (10th ed.). Cengage Learning.
Greene, W. H. (2012). Econometric analysis (7th ed.). Pearson Education.
Horngren, C. T., Datar, S. M., & Rajan, M. V. (2021). Cost accounting: A managerial emphasis (16th ed.). Pearson Education.
Kaplan, R. S., & Atkinson, A. A. (2014). Advanced management accounting (3rd ed.). Pearson.
Merchant, K. A., & Van der Stede, W. A. (2017). Management control systems: Performance measurement, evaluation and incentives (4th ed.). Pearson.
Indonesia Stock Exchange. (2019). "LQ45 Company Profiles August 2019." Retrieved from https://www.idx.co.id/media/7599/lq45companyprofilesaugust2019.pdf Indonesia Stock Exchange. (n.d.). "Data Saham Indeks Saham." Retrieved from https://www.idx.co.id/id/datapasar/datasaham/indekssaham
Universitas Surabaya (UBAYA). Digilib.ubaya.ac.id
Downloads
Published
How to Cite
Issue
Section
Citation Check
License
Copyright (c) 2025 Jurnal Ilmu Akuntansi dan Bisnis Syariah (AKSY)
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Lisensi Creative Commons
Jurnal Ilmu Akuntansi dan Bisnis Syariah are licensed under Attribution-ShareAlike 4.0 International
