The Role of Ownership in Increasing Firm Value of Manufacturing Industry in Indonesia

Abstract

This study examines the effect of the independent commissioner’s composition, audit committee, firm size, and profitability toward the value of manufacturing companies listed in the Indonesia Stock Exchange. The population of this research is manufacturing companies listed in the Indonesia Stock Exchange (IDX) from 2013-2015 that reported a complete annual report and published in the Indonesian Capital Market Directory. Researchers used a purposive sampling method and employed 208 companies as samples, and data processing in the study used multiple linear regression. Findings. This study find that the independent commissioner’s composition and Audit Committee has no significant effect on firm value. Finding also shows that firm size and profitability has a positive significant effect on firm value. Based on those findings, investors have to use financial information, especially financial reports, as information for long-term investment decisions. The finding may be useful for the listed companies in Indonesia Stock Exchange since they must know their size and profitability, and those variables are important to enhance their value.

The Effect of Non-Financial Factors on Firm Value with Tax Aggressiveness as Moderating

“…This research was supported by Ing Malelak et al, (2020). The results of this study contradict (Handriani, 2020;Hasanah et al, 2019) that independent commissioners have no effect on firm value. The audit committee plays an important role in the value of the company.…”

“…The non-financial factors that will be examined in this study are independent commissioners, audit committees and family ownership. Independent commissioners play an important role in the implementation of Good Corporate Governance, such as ensuring the company's strategy, supervising managers in managing the company, requiring the implementation of accountability, and providing guidance in managing the company (Handriani, 2020). Bhat et al,(2018) in their research results that independent commissioners have a significant positive effect on firm value on the Pakistan stock exchange.…”

Personality trait imprints across generations: small family business context

“…Thus, this study considered the predecessor's and successor's PTs in the SFB transition context. This study proposed that congruence of successor's and predecessor's PTs aligned with cultural cues, values and tradition is critical for successful succession transition in SFB (Eka, 2020). The successor having similar PTs to the predecessor is more likely to preserve and carry forward the core values of business operations and enrich the established traditions and cultural cues which keep on nurturing the SFB's success (Camfield & Franco, 2019).…”