Does the Implementation of Corporate Governance Moderate the Relationships of Ownership Structure, Capital Structure and Firm Values of Listed Manufacturing Companies in Indonesia?

Abstract

This study aims to examine corporate governance's role as a moderating variable in determining firm value, such as ownership structure and capital structure. Indonesian stock exchange manufacturing companies from 2014 to 2018 were used in this study. The data used was panel data, with data analysis carried out using the WarpPLS program. The results showed that the ownership structure had a significant effect on capital structure while ownership structure and capital structure had no significant effect on firm value. Ownership structure moderated by corporate governance has no significant impact on firm value. Capital structure moderated by corporate governance also has no significant impact on firm value. New findings from this research show that corporate governance cannot moderate the determinants of firm value, such as ownership structure and capital structure.

Capital Structure–Firm Performance Nexus: The Moderating Effect of Board Independence

“…It was observed that adding independent directors to the board has negatively changed the association between debt and firm performance, which is consistent with the empirical work of Abdulkarim and Bahamman (2021). In contrast to Mubaraq, Rahayu, Saifi, and Darmawan (2021), this study implies that increasing the control exercised by independent directors to reduce agency conflicts has an adverse impact on the relationship between debt and performance. This finding recommends that an efficient mix of independent directors to the total number of board members plays a crucial role, particularly in moderating the leverage and profitability association.…”

Capital structure, business model innovation, and firm performance: Evidence from Chinese listed corporate based on system GMM model

“…Meanwhile, some other scholars believe that capital structure and firm performance have a more complex relationship [71][72][73][74][75][76]. It is not linear but possibly U-shaped, inverted U-shaped, or different for different indicators [71,[77][78][79][80], even with no links [81][82][83][84]. Furthermore, Table 1 summarizes the research findings on the relationship between capital structure and firm performance.…”

“…Positive [12, 56-59, 61, 85] Negative [4,[64][65][66][67][68][69][70] U-shaped [75,76] inverted U-shaped [17,[71][72][73][74]78] No links [43,[81][82][83][84] Different for different indicators [8,18,80,86] https://doi.org/10.1371/journal.pone.0306054.t001…”

Board dynamics, dividend pay-out policy and banking efficiency in an emerging market context

“…However, previous studies have not tested this assertion. Mubaraq et al (2021) determined the moderating effect of corporate governance on the relationship between dividend and firm value. They found that a positive relationship exists between dividend policy and firm value.…”