The Mediating Effect of Financial Performance on GCG and Firm Value: Evidence from Indonesian Listed Firms
Abstract
This study examines the mediating effect of Financial Performance in the relationship between Good Corporate Governance (GCG) and firm value in the mining sector listing in Indonesia Stock Exchange (IDX) period 2016-2020. This study uses quantitative research type, with secondary data in the form of the company's financial statements obtained from the official website of the Indonesia Stock Exchange (IDX). The analytical method used path analysis techniques with the help of the Partial Least Square (PLS) program. The results of the research showed that Board Size has a positive impact on Financial Performance and Firm Value. In addition, other variables, such as the Independence Board of Commissioners did not affect Financial Performance, but had a positive impact on Firm Value. The results of this study also indicate that Financial Performance had a negative and no significant impact on Firm Value. In addition, Financial Performance as a mediating variable, is unable to mediate the influence between the Board Size and Firm Value. This study also found that Financial Performance as a mediating variable, is unable to mediate the influence between Independence Board of Commissioners and Firm Value.
Keywords
Full Text:
PDFReferences
Amaliyah, F., & Herwiyanti, E. (2019). The Influence of Institutional Ownership, Independent Board of Commissioners, and Audit Committee on Mining Sector Company Value. Journal of Accounting, 9(3), 187–200.
Astutik, EM (2021). Factors Influencing Firm Value With Profitability As Mediation Variables In The Mining Sector In Bei Years 2015-2018. Journal of Management Science, 9(1), 264–280.
Dahlia, ED (2018). The Influence of Managerial Ownership, Institutional Ownership, Independent Board of Commissioners and Audit Committee on Company Value with Profit Quality as an Intervening Variable in Manufacturing Companies Listed on the Indonesia Stock Exchange. Tower of Knowledge, 12(7), 16–27.
Daromes, FE, & Jao, R. (2020). Board of Directors Against Investor Reaction Mediation Role of Financial Performance on the Effect of. Journal of Accounting, 10(1), 77–92.
Eksandy, A. (2018). The Effect of Good Corporate Governance on Financial Performance in Indonesian Syari'Ah Banking. Journal of Accounting : Accounting Scientific Studies (JAK), 5(1), 1–10. https://doi.org/10.30656/jak.v5i1.498.
Emanuel, R., Antonius, J., Apriyanto, RP, Firmansyah, A., Accounting, M., Tarumanagara, U., Accounting, M., Tarumanagara, U., Accounting, M., Tarumanagara, U., Accounting , M., & Tarumanagara, U. (2022). Board of Directors, Cash Holding, Firm Value: The Moderating Role of Leverage. MY JOURNAL, 2(1), 54–67.
Ha, NM, Anh, PT, Yue, X.-G., & Nam, NHP (2021). The Impact of Tax Avoidance on The Value of Listed Firms in Vietnam. Cogent Business and Management, 8(1), 1–13. https://doi.org/10.1080/23311975.2021.1930870.
Hidayat, T., Triwibowo, E., & Marpaung, NV (2021). The Influence of Good Corporate Governance and Financial Performance on Company Value. Pelita Bangsa Journal of Business Accounting, 6(1), 1–18. https://doi.org/10.46799/jst.v1i10.164.
Hunardy, N., & Tarigan, J. (2017). The Effect of Government Ownership on Financial Performance Through the Independent Board of Commissioners as an Intervening Variable. Business Accounting Review, 5(2), 602–604.
Ichfan, K., Mutmainah, S., & Mila. (2019). The Importance of Financial Management for Companies. Journal of Islamic Accounting and Finance, 1(2), 32–42.
Indawati, & Anggraini, A. (2021). The Effect Of Company Financial Performance With Financial Ratio To Company Value. Lively Journal, 4(2), 8–30.
Intia, LC, & Azizah, SN (2021). The Influence of the Board of Directors, Independent Board of Commissioners, and Sharia Supervisory Board on the Financial Performance of Islamic Banking in Indonesia. Journal of Financial and Accounting Research, 7(2), 46–59. https://doi.org/10.25134/jrka.v7i2.4860.
Irma, ADA (2019). The Influence of Commissioners, Audit Committee, Ownership Structure, Size, and Leverage on the Financial Performance of Property, Housing and Construction Companies 2013-2017. Journal of Management Science, 7(3), 697–712. https://jurnalmahasiswa.unesa.ac.id/index.php/jim/article/view/28953.
Islami, N., Zulfikar, R., & Ismawati, I. (2022). The Influence of Financial Performance, Dividend Policy and Capital Structure on Company Value (Empirical Study of Banking Sub-Sector Companies Listed on the Indonesia Stock Exchange Period 2016 - 2020). Indonesian Journal of Economy, Business, Entrepreneurship and Finance, 2(2), 28–36.
Jao, R., Randa, F., Holly, A., & Gohari, L. (2021). The Influence of the Characteristics of the Board of Directors on the Financial Performance of Non-Financial Companies Listed on the Indonesia Stock Exchange. Accent SCIENTIFIC JOURNAL, 18(2), 123–134.
Khanh, VT Van, Hung, DN, Van, VTT, & Huyen, HT (2020). A Study On The Effect Of Corporate Governance and Capital Structure On Firm Value in Vietnam. Accounting, 6(3), 221–230. https://doi.org/10.5267/j.ac.2020.3.004.
Khaoula, F., & Moez, D. (2019). The Moderating Effect of The Board of Directors nn Firm Value and Tax Planning: Evidence from European Listed Firms. Borsa Istanbul Review, 19(4), 331–343. https://doi.org/10.1016/j.bir.2019.07.005.
Li, W., Lu, Y., & Li, W. (2019). Does CSR action provide insurance-like protection to tax-avoiding firms? Evidence from China. Sustainability (Switzerland), 11(19), 1–19. https://doi.org/10.3390/su11195297.
Liswatin, & Sumarata, RP (2022). The Effect of Capital Structure, Financial Performance and Company Size on Firm Value. Sinomik Journal, 1(2), 79–88. https://publish.ojs-indonesia.com/index.php/SINOMIKA.
Marini, Y., & Marina, N. (2017). The Effect of Good Corporate Governance on Company Value (Empirical Study of Manufacturing Companies Listed on the Indonesian Stock Exchange). Journal of Humanities, 1(1), 1–14.
Maryanto, HK (2017). The Effect of Intellectual Capital and Good Corporate Governance on Firm Value with Financial Performance as an Intervening Variable in Manufacturing Companies on the Indonesia Stock Exchange in 2011-2014. JOM Fekon, 4(1), 1598–1612.
Megawati, H. (2021). Good Corporate Governance and Financial Performance (Empirical Study on SOEs in Indonesia). Media Accounting and Taxation Indonesia, 2(2), 139–160. https://doi.org/10.37715/mapi.v2i2.1724.
Mishra, R., & Kapil, S. (2017). Effect of Ownership Structure and Board Structure on Firm Value: Evidence from India. Corporate Governance (Bingley), 17(4), 700–726. https://doi.org/10.1108/CG-03-2016-0059.
Nurhanimah, Anugerah, R., & Ratnawati, V. (2019). The Effect of Earnings Management and Tax Avoidance on Firm Value with Ownership Structure as a Moderating Variable in LQ45 Group Companies on the IDX in 2013-2016. Journal of Business Administration, 3(1), 1–13. https://doi.org/10.30871/jaba.v3i1.1281.
Nurhidayah, N., & Maryanti, E. (2021). The Effect of Good Corporate Governance on Corporate Values and Financial Performance as an Intervening Variable in State-Owned Companies Listed on the Indonesia Stock Exchange in 2016-2018. Academia Open, 5(December), 1–15. https://doi.org/10.21070/acopen.5.2021.2448.
Nuryono, M., Wijanti, A., & Chomsatu, Y. (2019). The Influence of Managerial Ownership, Institutional Ownership, Independent Commissioners, Audit Committee, and Audit Quality on Firm Value. Edunomika Scientific Journal, 3(01), 199–212. https://doi.org/10.29040/jie.v3i01.457.
Onasis, K., & Robin. (2016). The Effect of Corporate Governance on Corporate Value in Financial Sector Companies Listed on the IDX. Economic Development, 20(1), 1–22. https://doi.org/10.26593/be.v20i1.1893.1-22.
Permono, B., & Puspaningsih, A. (2022). The Effect of Good Corporate Governance and Company Size on Company Financial Performance (Empirical Study of Manufacturing Companies in the Food and Beverage Sector Listed on the IDX in 2017-2019). Proceedings Of National Conference On Accounting & Finance, 4, 37–43. https://doi.org/10.20885/ncaf.vol4.art7.
Pranoto, SFF, Kusumawardani, MR, & Akbar, T. (2022). The Effect of Financial Performance on Firm Value in Cosmetic Subsector Companies Listed on the Indonesia Stock Exchange in 2016-2022. Journal of Accounting Science Research, 1(3), 240–253. https://doi.org/10.55606/jurnalrisetilmuakunansi.v1i3.90.
Prayanthi, I., & Laurens, CN (2020). The Influence of the Board of Directors, Independent Commissioners, and the Audit Committee on Financial Performance in the Food and Beverage Sector. Klabat Journal of Management, 1(1), 66–89.
Rinahaq, & Widyawati, D. (2020). The Influence of Managerial Ownership, Institutional Ownership, Independent Board of Commissioners, Profitability and Leverage on Company Value. Journal of Accounting Science and Research, 9(5), 1–19.
Riska, R., Raza, H., & Zulfa, A. (2020). The Influence of Financial Performance on the Value of Manufacturing Companies on the Indonesia Stock Exchange With Dividend Policy as a Moderating Variable. J-MIND (Indonesian Management Journal), 5(1), 95. https://doi.org/10.29103/j-mind.v5i1.3428.
Rosinta, A. (2022). The Influence of Financial Performance on Firm Value with Dividend Policy as a Moderating Variable. Journal of Accounting Science and Research, 11(11), 1–20. https://doi.org/10.35838/jrap.v6i01.400.
Sandria, F. (2021). Hit by the 2020 Pandemic, Take a Peek at the Performance of 10 Indonesian Coal Giants. CNBC Indonesia. https://www.cnbcindonesia.com/market/20210303141134-17-227577/dihantam-pandemi-2020-intip-kinerja-10-raksasa-batu-bara-ri?page=all.
Saputri, M., & Isbanah, Y. (2021). The Effect of Good Corporate Governance and Corporate Social Responsibility on Company Value and Financial Performance as a Mediation Variable in Misscellaneous Industry Companies on the IDX for the 2016-2019 period. Journal of Management Science, 9(2), 651. https://doi.org/10.26740/jim.v9n2.p651-669.
Saragih, ELSO, & Handayani, S. (2022). The Influence of Financial Performance and Governance on Company Value in the Health Sector on the Indonesia Stock Exchange 2016-2020. JIMEA | MEA Scientific Journal (Management, Economics, and Accounting), 6(3), 685–702.
Siek, RW, & Muhardi, WR (2015). Study of the Effect of Corporate Governance on Company Value. University of Surabaya Student Scientific Journal, 4(2), 1–32.
Suri, A., Wulandari, R., & Setiyowati, SW (2020). Analysis of the Influence of Profitability, Capital Structure, Managerial Ownership and Independent Board of Commissioners on Company Value. Journal of Accounting Student Research (JRMA), 8(1), 1–7. https://doi.org/10.21067/jrma.v8i1.4451.
Suryandani, A. (2018). The Influence of Company Growth, Company Size, and Investment Decisions on Company Value in Property and Real Estate Sector Companies. Business Management Analysis Journal (BMAJ), 1(1), 49–59. https://doi.org/10.24269/iso.v3i1.236.
Trihandayani, U., & Badjuri, A. (2022). Determinants of Firm Value with Financial Performance as a Moderator in Companies Listed on the Indonesian Stock Exchange. Fair Value: Scientific Journal of Accounting and Finance, 4(11), 4879–4892. https://doi.org/10.32670/fairvalue.v4i11.1827.
Umam, SFM, & Ginanjar, Y. (2020). The Influence of the Sharia Supervisory Board and the Proportion of Independent Commissioners on the Financial Performance of Indonesian Sharia Banking. Islamic Economics and Business, 3(1), 72–80.
Utomo, FM, & Dianawati, W. (2017). Corporate Governance And Leverage Against Corporate Values With Profit Quality As Mediation Variables. Journal of Islamic Investment, 2(2), 21–44.
Valensia, K., & Khairani, S. (2019). The Effect of Profitability, Financial Distress, Independent Board of Commissioners and Audit Committee on Company Value Mediated by Tax Avoidance (Empirical Study of Consumer Goods Industry Companies Listed on the Indonesia Stock Exchange Period 2. Journal of Accounting, 9(1), 47–64. https ://doi.org/10.33369/j.accountancy.9.1.47-64.
Wahyudi, HD, Chuzaimah, C., & Sugiarti, D. (2016). The Influence of Firm Size, Profitability, Dividend Policy, and Investment Decisions on Firm Value (Study of Using LQ-45 Index Period 2010 -2014). Benefit: Journal of Management and Business, 1(2), 156–164. https://doi.org/10.23917/benefit.v1i2.3259.
Wendy, T., & Harnida, M. (2020). The Influence of the Implementation of Good Corporate Governance (Managerial Ownership, Institutional Ownership, Independent Board of Commissioners, and Board of Directors) on the Financial Performance of Banking Companies Listed on the IDX. Journal of Management and Accounting, 21(1), 15–24.
Wibowo, DRP, Relawati, R., & Shodiq, WM (2022). The Influence of Financial Performance on Agricultural Company Firm Value on the IDX in 2018. Surplus: Research Journal of Economics, Management, and Accounting Students, 1(2), 106–117. https://doi.org/10.35449/surplus.v1i2.390.
Widhiastuti, S., Eftianto, E., & Ahmadi, S. (2019). The Influence of Financial Performance on Company Value Mediated by the Disclosure of the Sustainability Report. Scientific Journal of Accounting and Finance, 8(2), 24–43. https://doi.org/10.32639/jiak.v8i2.314.
Winarno, SH (2019). NPM, ROA, and ROE Analysis in Measuring Financial Performance. STEI Journal of Economics, 28(02), 254–266. https://doi.org/10.36406/jemi.v28i02.254.
Yopie, S., & Andriani, E. (2021). Analysis of the Influence of the Characteristics of the Board of Directors and Ownership Structure on the Financial Performance of Family Companies. Jesya (Journal of Economics & Sharia Economics), 4(2), 1137–1146. https://doi.org/10.36778/jesya.v4i2.469.
Yuniarti, N., Nurangraini, I., Astuti, B., Ranidiah, F., & Pertiwi, DE (2022). The Effect of Financial Performance on Company Value with Corporate Social Responsibility as a Moderating Variable (Empirical Study of Banking Companies Listed on the Indonesia Stock Exchange for the 2018-2020 Period). EKOMBIS REVIEW: Scientific Journal of Economics and Business, 10(S1), 281–298. https://doi.org/10.37676/ekombis.v10is1.2053.
Yusmaniarti, Febriyanti, & Astuti, B. (2020). Effect of Good Corporate Governance Implementation, Auditor Independence and Audit Quality on Company Value. JSMBI (Indonesian Business and Management Science Journal), 10(1), 50–67.
Zhu, J., Ye, K., Tucker, JW, & Chan, K. (Johnny) C. (2016). Board Hierarchy, Independent Directors, and Firm Value: Evidence from China. Journal of Corporate Finance, 41, 262–279. https://doi.org/10.1016/j.jcorpfin.2016.09.009.
DOI: http://dx.doi.org/10.18415/ijmmu.v10i9.4970
Refbacks
- There are currently no refbacks.
Copyright (c) 2023 International Journal of Multicultural and Multireligious Understanding
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
https://ijmmu.com
editor@ijmmu.com
facebook.com/ijmmu
Copyright © 2014-2018 IJMMU. All rights reserved.