The Effects of Good Corporate Governance for Corporate Value in Plantation Companies at Indonesian Stock Exchange (IDX)

Abstract

Objective - This research aims to identify the effect of good corporate governance ('GCG') factors such as the size of the board, the presence of independent commissioners and audit committees, managerial ownership, and institutional ownership on corporate value (price to book value). This study also uses profitability measured by Return on Assets ('ROA') as moderating variables. Methodology/Technique - The object of this study is plantation companies listed on the Indonesian Stock Exchange (IDX) between 2011 to 2015. The samples are selected by using purposive sampling method. The hypothesis in this study is tested by using multiple linear regression. Findings - There are three variables that significantly influence corporate value. These are independent commissioners, managerial ownership, and institutional ownership. Moreover, profitability does not moderate the relationship between GCG and company value. Novelty - The research is intended to find a relationship between good corporate governance and firm performance among plantation companies. Type of Paper - Empirical Keywords: Audit Committee; Corporate Values; Good Corporate Governance; Independent Commissioner; Institutional Ownership; Managerial Ownership; Price to Book Value; Return on Assets.