The Effect of the Board of Directors and Environmental Performance on Financial Performance

This study aimed to determines the impact of board and environmental performances on financial performances. The population of this survey is the Islamic bank for the period 2016-2021. The sampling method used is purposive sampling, so the sample are 73 companies that meet the criteria. The data analysis method used is multiple regression analysis using SPSS programs. The results of this survey show that the age diversity of the board has a positive impact on financial performance, but it is not important. Board education does not affect financial performance. Environmental performance does not affect financial performance. This work is licensed under a Creative Commons Attribution 4.0 International License.


INTRODUCTION
Companies that have large assets will generally get more attention from the public. This makes the company more careful in its financial statements. Companies must always try to maintain the stability of their financial Performance. This good financial report certainly cannot be made without good Performance from all parts of the company [27]. Companies can achieve their goals through efficient and effective use of resources and describe the extent to which a company has achieved results when compared to previous performance results is an environmental performance assessment that is used as a basis for assessment [16]. Enforcing good corporate governance is crucial to building and maintaining public trust in a companies. Corporate governances is a system that regulates and controls companies, and is expected to creates and improves the corporate value of stakeholders [26].
Corporate governances is a set of clear rules, procedures, and relationships between peoples who make good decisions and control those decisions. Supervision is an integral part of the management process. Supervising means seeing and noticing that what is being done is consistent with the plan [3]. The Board of directors is an important organization of the companies. It is responsible for the directions and management of the company, the protection of the interests of shareholders, and the oversights [8], including its financial Performance.

H2: Educational diversity of the Board of directors has a positive effect on financial Performance The Effect of Environmental Performance on Financial Performance
Environmental Performance is a mechanism that allows a company to voluntarily communicate environmental issues in its business and interact with stakeholders beyond the legal responsibilities of the organization [30]. Environmental performance is a mechanism by which a company voluntarily communicates its business's environmental issues and interactions with stakeholders beyond the organization's legal responsibilities [23] research resulted in a significant effect of environmental Performance on the companies financial Performance. In line with researches conducted by [9] shows that the greater the diversity of ages, the more aggressive the companies financial development is, as it balances the prudence of the older generation with the innovation of the younger generation. H3: environmental Performances has a positive effect on financial Performance

RESULT AND DISCUSS 3.1 Population and Sample
The population and samples used in this survey are for Islamic banks from 2016 to 2021. The sampling technique that used in thiss research is purposive sampling. Based on the sample criterias that have been selected in this study, the research sample obtained is 15 companies for each year where the period used in the study is 2016-2021. So that the total sample used is 90, with a total of 73 data that meet the criteria.

Operation Definition
Board of Directors Age Diversity (X1) World Health Organization (WHO) classifies the elderly into 4, namely middle age 45-59 years, elderly 60-74 years, elderly 75-90 years and very old age (very old) above 90 years. Board age is the one type of board diversity measurement that has an influence on firm value [12]. The age of directors is considered to depend on their level of experience and risk tolerance. The age difference in the management will create a good relationship between the Board and stakeholders from different age groups. Senior members are more likely to deal with government agencies or government regulations. While junior members can match the aspirations of the next generation of customers [2]. Age differences provide diversity in the experience, skills and social networks of board members. The older a person gets, usually the person is wiser [13]. Middle-aged adults between the ages of 40 and 60 are mature. By the ages of 40, most people had achieves the peak of their careers. Middle-aged executives have the wisdom to make mature decisions that can affect the companies Performance. The age diversities of the Board of directors can be formulated as follows:

Diversity Education Board of Directors (X2)
Educational background is related to one's intellectual abilities, the higher the education taken, the wider the intellectual abilities. Majors and levels of education will be used in determining the company's qualifications in obtaining employees so as to increase the values of company performances. Although not a requirement, it will be important because the background of the Board of directors is in appropriate with the companies field so that they are able to manage the company and make more mature decisions [33].
The resulting decisions can affect the effectiveness of the companies and make it easier to finish the problems because people with the right education are more capable in business, the resulting decisions can affect the effectiveness of the company and make it easier to solve problems. Therefore, the educational background of the Board of directors affects the value of the companies [12].

Environmental Performance (X3)
The concept of efficiency refers to the levels of environmental damage caused by the company's activities, where less damage indicates good Performance of the company and vice versa [14]. One of the measurements that can be carried out for environmental Performance is using the bank's EMP (Environmental Management Performance) assessment index in accordance with research conducted by [4], where the EMP index consists of the number of the environmental audits, staff trainings, supplier audits, cases of non-compliances with environmental regulations, also 25 environmental certified locations. From each of these indicators there are points that will be analyzed in the companies annual report. The calculation is as follows: Financial Performance is the outcome of a company's Performance over time and can reflect the company's health. There are several important numbers for assessing a company's financial Performance, such as liquidity, leverage, activity, profitability, growth, and market value. In this study, financial Performance is measured using profitability metrics that measure management's effectiveness in generating revenue and investment-related profits. The profitability ratio used in study is the return on assets (ROA), a comparison of profits earned with  The table above shows that the VIF value is < 10, and the tolerance value > is 0,10. This it can conclude that the data do not have multicollinearity.
Heteroscedasticity Testing  The value of the regression coefficient for the DD variable Education is -0.008, and any increase indicates that there is one director with an economic background, the value of the Islamic Social Reporting variable will decrease in score by -0.008 with the assumption that the other variables are 0 (zero).   667). Based on the analysis results, the environmental performance variable does not affect financial performing. This means that H2, which states that environmental performing has a positive effect on financial performance is rejected.

CONCLUSION
This study is intended to determine the effect of Age Diversity Board of Directors, Board of Directors education, and environmental Performance on the Financial Performance of Islamic commercial banks from 2016 to 2021. The conclusions that can be drawn from this survey are: 1. Age Diversity Board of Directors have a positive but not significant effect on financial performance. 2. Board of Directors education has no effect on financial Performance. 3. Environmental Performance does not affect financial Performance.