The Influence of Top Management Team (TMT) Characteristics Toward Indonesian Banks Performance During the Digital Era (2014–2018)

20 Pages Posted: 18 Mar 2020

See all articles by Gabriel Mojambo

Gabriel Mojambo

Sam Ratulangi University

Joy Elly Tulung

Sam Ratulangi University

Regina Trifena Saerang

affiliation not provided to SSRN

Date Written: February 20, 2020

Abstract

Despite the abundant opportunities in the Indonesian bank industry, the digital era began to challenge banks to fully embrace the use of technology (information) to prolong competitive advantage. An organization becomes a reflection of its top managers. In facing such challenges, Top Management Team (TMT) members' initiative to overcome the current status quo, will be reflected in the company under their management. For this reason, an effective TMT structure is mandatory during the digital era to digitalize banking firms. This research investigates the relationship between top management team characteristics and Indonesian banks' financial performance during the digital era. For top management team characteristics, this research includes functional background, gender diversity, average age, level of education, IT Expertise, and experience in years. While to measure the performance of Indonesian banks' financial performance the paper includes return on asset (ROA), capital adequacy ratio (CAR), and non-performing loan (NPL). The results show that gender diversity has positive significant influences on NPL, average age have positive significant influences on ROA, CAR, NPL, and IT expertise have positive significant influences on CAR.

Keywords: Banks, Top Management Team, Performance

JEL Classification: G21, G34

Suggested Citation

Mojambo, Gabriel and Tulung, Joy Elly and Saerang, Regina Trifena, The Influence of Top Management Team (TMT) Characteristics Toward Indonesian Banks Performance During the Digital Era (2014–2018) (February 20, 2020). Available at SSRN: https://ssrn.com/abstract=3541856

Gabriel Mojambo

Sam Ratulangi University ( email )

Manado, north sulawesi 95115
Indonesia

Joy Elly Tulung (Contact Author)

Sam Ratulangi University ( email )

Manado, north sulawesi 95115
Indonesia

Regina Trifena Saerang

affiliation not provided to SSRN

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