The Determinant of Financial Distress on Indonesian Family Firm

This paper aims to find the influence of the corporate governance and financial ratios on the probability of financially distressed family firms in Indonesia that are listed in Indonesia Stock Exchange in the period of 2008 – 2013. There is a performance difference between family firms and non-family firms in Indonesia, but there is no risk difference between both of them. The logistic regression showed that the adoption of corporate governance can boost company's financial performance and allow them to avoid financial distress. This study also showed that conservative capital structure is not adopted by the Indonesian family firm.