The Effect of Good Corporate Governance Mechanism, Leverage, and Firm Size on Firm Value

Abstract

The objectives of this research are to examine (1) the
effect of the good corporate governance mechanism (audit
committee, size of the commissioner’s board, and proportion of
independent commissioner’s board) on firm value. (2) The effect
of the leverage on firm value, (3) The effect of the firm size on
firm value, and (4) The effect of good corporate governance
mechanism (audit committee, size of the commissioner’s board,
and proportion of independent commissioner’s board), leverage,
and firm size on firm value. The population in this research is the
entire manufacture firm which listed in IDX 2007-2011.
Sampling technique used in this research is judgment sampling,
with the sum of the sample 28 firm for 5 years (2007-2011).
Double linier regression is used as data analysis technique, both t
test and F test. The results of this research are (1) Good
corporate governance’s mechanism, which including the size of
commissioner’s board affect on the firm value, meanwhile audit
committee and the proportion of independent commissioner’s
board doesn’t affect on the firm value; (2) Leverage doesn’t
affect on the firm value; (3) The firm size affects on the firm
value; and (4) good corporate governance mechanisms (audit
committee, size of the commissioner’s board, and proportion of
independent commissioner’s board), leverage, and firm size
affect on the firm value.