FINANCIAL AUTONOMY AND FINANCIAL PERFORMANCE IN INDONESIAN PUBLIC UNIVERSITIES: STRENGTHENING THE ROLE OF HIGHER EDUCATION INSTITUTIONS TOWARD SUSTAINABLE DEVELOPMENT GOALS

Abstract

Financial Autonomy and Financial Performance in Indonesian Public Universities: Strengthening the Role of Higher Education Institutions toward Sustainable Development Goals

The transformation of higher education governance positions universities as strategic actors in economic development and sustainability. While institutional autonomy is expected to enhance performance, comparative evidence in developing countries remains limited. This study examines differences in financial performance of Indonesian public universities based on autonomy levels and their implications for strengthening institutional capacity in supporting Sustainable Development Goals (SDGs).

This study uses a quantitative approach with a cross-sectional comparative design across 63 PTNs in Indonesia in 2025: 21 PTN Satker, 21 PTN BLU and 21 PTN BH. Financial performance is measured using official national indicators, namely Budget Performance Evaluation (EKA), Budget Execution Performance Indicator (IKPA), and Budget Performance Value (NKA). It is then analyzed using one-way ANOVA, supplemented by the Tukey HSD test, and effect size (Eta Squared).

The results of the One-Way ANOVA test showed no significant difference in the EKA (P>0.05), but significant differences in the IKPA and NKA (p<0.001). Tukey HSD indicated that differences mainly occurred between PTN BH and both PTN BLU and Satker, while no significant difference was found between PTN BLU and Satker. Effect size analysis showed large effect on IKPA and NKA (η² > 0.5), but small on EKA.

These findings indicate that financial autonomy improves managerial processes and budget governance but does not directly affect output effectiveness. The study enriches NPM theory by showing that autonomy’s impact is partial and contextual. Improved budget performance reflects stronger institutional capacity, supporting SDG 16 (strong institutions) and indirectly contributing to SDG 4 (quality education).