Effect of governance practices on value co-creation and organizational performance: Evidence from village-owned enterprises in Riau, Indonesia

Abstract

A broader community is currently paying a significant deal of attention to the existence of social enterprises. This is due to the belief that social enterprises can bring answers to community issues. Village-Owned Enterprises (VOEs), as one of the social enterprises that are expected to continue providing sustainable welfare for villages, must always strive for excellent organizational performance to fulfill their objectives. This study is based on the notion of participatory governance; it seeks to evaluate the effect of governance practices on value co-creation, as well as the effect these practices have on organizational performance. This paper collects data utilizing a structured questionnaire and a quantitative research approach. A cluster sampling methodology is used. The respondents are directors of VOEs in Riau Province, Indonesia. One hundred twenty-five data were analyzed using partial least squares (PLS) of the second order. The results reveal that good governance practices will boost value co-creation, enhancing organizational performance. The findings suggest that VOEs should pay particular attention to their process of managing, monitoring, and accountability to achieve value co-creation and fulfill their mission. The uniqueness of this study lies in its investigation of the governance practices of VOEs and the crucial role of value co-creation in enhancing their organizational performance. AcknowledgmentWe express our gratitude and appreciation to The Directorate of Resources, The Directorate General of Higher Education, The Ministry of Education, Culture, Research and Technology (Ref. 1615/UN.19.5.1.3/PT.01.03/2022) for financial support for this study. We also express the same appreciation to LPPM Universitas Riau for facilitating this research project.

Empowering village-owned enterprises: Examining leadership, innovation and government support

“…Organizational performance is multifaceted including various dimensions such as financial indicators, market effectiveness, stakeholder satisfaction and the attainment of strategic goals [26][27][28]. When considering VOEs, it is essential to analyze many aspects of their performance including their financial sustainability, potential to provide local employment opportunities, and more significant social effects on the community.…”

Pelatihan Peningkatan Kapasitas Manajemen Tata Kelola BUM Desa Berbasis Good Corporate Governance di Desa Sandosi

“…Di era good governance, pelaksanaan tata kelola BUM Desa perlu didorong ke arah good corporate governance (Titania & Utami, 2021;Yuliana & Alinsari, 2022). Pendekatan good corporate governance dengan prinsip tata kelola yang mencakup kooperatif, partisipatif, emansipatif, transparan, akuntabel, dan berkelanjutan, mampu menghasilkan kinerja organisasi yang lebih baik bagi BUM Desa (Nelly Sari et al, 2022). Ringkasnya manajemen tata kelola yang tinggi akan berdampak terhadap kinerja BUM Desa, sebaliknya pengelolaan BUM Desa dengan prinsip tata kelola yang rendah akan menghambat capaian kinerja BUM Desa (Syam et al, 2020), Berangkat dari situasi problematis diatas, maka upaya pengembangan BUM Desa melalui penguatan dan peningkatan kapasitas pengurus perlu dilakukan.…”

Penerapan Tata Kelola Badan Usaha Milik Desa dalam Mewujudkan Sustainable Development Goals Desa

“…Tata kelola secara umum didefinisikan sebagai suatu teknik untuk mengarahkan dan mengendalikan organisasi agar secara efektif tujuan tercapai (Sari et al, 2021). Definisi dan tujuan dari tata kelola beragam berdasarkan berdasarkan konteks sistem hukum, budaya, situasi, dan sektor usaha (Widiastuti et al, 2019).…”

“…Implementasi tata kelola BUMDes dalam perspektif good corporate governance sangat penting dalam mengelola BUMDes (Titania & Utami, 2021). BUMDes yang berbasis prinsip kooperatif, partisipatif, emansipatif, transparan, akuntabel, dan berkelanjutan terbukti mampu menghasilkan kinerja organisasi yang lebih baik bagi BUMDes (Sari et al, 2021). Berdirinya BUMDes dapat mengurangi pengangguran di desa dan memberikan perubahan serta meningkatkan kesejahteraan masyarakat desa (Arindhawati & Utami, 2020).…”