Zmijewski (X-Score) Model for Financial Distress Prediction: Implementing Good Corporate Governance In Indonesia

Financial distress is an indication that a company's finances are not healthy but are still some distance from bankruptcy. Companies can identify financial problems earlier as a foundation for internal assessment and communication. One of the causes of financial distress is the state of corporate governance. The purpose of this research is to determine the effect of good corporate governance, as proxied by managerial ownership, institutional ownership, an independent board of commissioners, audit committee, and managerial agency costs, on financial distress, as calculated using the Zmijewski model (X-Score), in consumer goods companies listed on the Indonesia Stock Exchange from 2019 to 2021. The sampling technique uses the purposive sampling method and22 consumer goods industry companies met the criteria with 66 data used as research samples. The analytical method used in this research is logistic regression analysis. The results show that the independent board of commissioners has a significant effect on financial distress using the Zmijewski approach. Meanwhile, managerial ownership, institutional ownership, audit committee, and managerial agency costs do not have a significant effect on financial distress with the Zmijewski approach.