The Influence Of Corporate Governance Practice On Financial Performance And Firm Value Of Indonesian State-Owned Enterprises (A Study on Indonesian State-owned Enterprises Surveyed by The Indonesian Institute for Corporate Governance and Listed in Indonesia Stock Exchange 2005-2012)

Abstract

Merinda Hasna Lupita Dewi (2014). The Influence of Corporate Governance Practice on Financial Performance and Firm Value of Indonesian State-owned Enterprises (A Study on Indonesian State-owned Enterprises Surveyed by The Indonesian Institute for Corporate Governance and Listed in Indonesia Stock Exchange 2005 – 2012) The aim of this research is to assess the influence of corporate governance practice on Indonesian State-owned enterprises to their financial performance and firm value. The Corporate Governance Perception Index (CGPI) score issued by The Indonesian Institute for Corporate Governance becomes the proxy of corporate governance measurement. In this research, the company’s financial performance is assessed by using Return on Assets and Return on Equity, and the Tobin’s Q score becomes the measurement of firm value. The regression model is used as the statistical model in this research, with the research sample-size of fifty-nine firms (59 firms), which consist of public Indonesian State-owned enterprises (during 2005 until 2012) that listed in the CGPI index during 2005 until 2012. The result of the study indicates that there is no influence of corporate governance practice on the performance of Indonesian State-owned enterprises Return on Assets and Return on Equity as the proxy of company’s financial performance and Tobin’s Q score, as the proxy of the firm value of Indonesian State-owned enterprises. Keywords: Corporate governance, Indonesian State-owned Enterprises, financial performance, firm value, ROA, ROE, Tobin’s Q