The mediating effect of leverage and dividend policy on the influence of corporate governance towards firm value

Soewarno, Noorlailie; Arifin, Stephanie Yulia; Tjahjadi, Bambang

doi:10.1051/shsconf/20173404002

Cited by 9 publications

(10 citation statements)

References 15 publications

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“…In contrast to previous research results where commissioners' existence significantly affects the firm's value, this finding is consistent with the initial goal of its existence to control the management so that investors appreciate it positively as reflected in rising stock prices (Isshaq et al, 2009). Soewarno et al (2017) also notes the results of the same study where good governance has a positive and significant impact on firm value. The different results are analyzed because of the different perception of investors towards the existence of commissioners and independent commissioners.…”

Section: The Effect Of the Investment Decision On Corporate Value Modsupporting

confidence: 85%

“…Yagil (2007) argues that there are debates on how the dividend policy affects stock prices, some of them say that the rise in stock prices is more influenced by operational profitability than the number of dividends paid, while others argue that dividend policies have a positive effect on the long-term performance of stock prices. Soewarno et al (2017) notes in his research that dividend policy is a significant variable that influences corporate governance on corporate value. Therefore, the research hypothesis is stated as follows:…”

Section: Corporate Dividend and Firm Valuementioning

confidence: 99%

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Antecedents and Outcomes of Corporate Governance: Evidence from Indonesia

Khajar¹,

Hersugondo²,

Udin³

2018

ERSJ

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This study empirically explores the relationship between three important decisions in financial theory and the business organization goals for 18 companies incorporated in the LQ-45 index listed on the Indonesia Stock Exchange (IDX) over the periods 2010-2017. The purpose of this study is to investigate the effect of investment opportunities, dividend policy and financial decision on firm value and to examine the contribution of corporate governance in moderating the effect between investment opportunities to firm value. This study employs panel data regression through Eviews 9 program specification methodology. The results of the panel data regression analysis indicate a positive and significant relationship between investment opportunities, financial decision, and firm value. The results also indicate that corporate governance has a significant negative moderating effect on investment decision to firm value.

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Section: The Effect Of the Investment Decision On Corporate Value Modsupporting

confidence: 85%

Section: Corporate Dividend and Firm Valuementioning

confidence: 99%

Antecedents and Outcomes of Corporate Governance: Evidence from Indonesia

Khajar¹,

Hersugondo²,

Udin³

2018

ERSJ

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“…It is the ratio between total debt and its equity (Isshaq et al, 2009). On the contrary, Azmat, 2014 used Debt Asset Ratio (DAR), while Soewarno et al, 2017 combined two factors to measure the level of corporate leverage. The higher the DER, the higher the company's debt compared to the funding paid by the owners of the company.…”

Section: Funding Decision and Firm Valuementioning

confidence: 99%

“…On the other Article's contents are provided on a Attribution-Non Commercial 4.0 Creative commons license.To see the complete license contents, please visit http://creativecommons.org/licenses/by-nc/4.0/ hand, some researchers stated that dividend policy positively affects the long-term performance of stock prices. Soewarno et al, 2017 suggested that dividend policy is a significant variable that mediates the influence of corporate governance on firm value.…”

Section: Dividend Policy and Firm Valuementioning

confidence: 99%

Increasing Firm Value Based On External Governance And Modern Finance theory

Khajar

Alfian

2022

JBMR

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It is based on the theory of firm and external agency that through investment, funding, and dividend decisions to achieve max firm value. The purpose of this study is to re-examine this model for cases in Indonesia. The sample population of this study comprised 18 companies listed on the Indonesia stock exchange that become the members of LQ-45 index from 2016-2019. The samples were selected by purposive sampling. This study used panel data regression analysis program with Eviews-9 application to answer the research objectives. The results indicated that investment decisions had a significant positive effect, funding decisions had a significant negative effect and dividend decisions had no significant negative effect on firm value.

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“…divide ownership structure into two categories based on capital contributions: inner investors (managers) and outside investors (debt holder and equity holder). Ownership structure is defined by Abel and Okafor (2010) as the percentage of shares held by managers (managerial ownership), institutions (institutional ownership), the government (state ownership), foreign investors (foreign ownership), families (family ownership), and so on (Soewarno et al 2017).…”

Section: Research Aims and Questionsmentioning

confidence: 99%

The Effect of Ownership Structure, Board Size and Firm Value on Corporate Financial Leverage and Dividends Policy: An Applied Study

Megeid

2021

الفکر المحاسبى

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The paper aims to investigate the empirical linkage between the explanatory variables, ownership structure and one of the corporate governance mechanism namely board size and firm value on the most important corporate financial decisionsfinancial leverage and dividend policy in an emerging market, Egypt.To achieve the research objectives, we used a sample of 50 non-financial firms chosen from the more actively traded listed Egyptian firms on the Egyptian Stock Exchange (EGX) from 2015 to 2020. Measure of corporate financial leverage employed is the total debt/assets ratio. The measures of ownership structure include managerial ownership, institutional ownership, block holder's ownership and foreign ownership. The firm value is computed by contrasting the market value of equity (capital) with the adjusted value of equity. Similarly, the effect of some control variables like firm size, profitability and Tobin's Q has been also examined. The multiple regression models (OLS) were used to analyze the data and to test the research hypotheses using the published annual financial reports and other related data.Results show for the first hypothesis tested, that managerial ownership and block holder ownership are significantly positively related to corporate leverage, while institutional ownership and foreign ownership are significantly negatively related to corporate leverage, whereas board size is found to be insignificantly negatively correlated and firm value is positively correlated with financial leverage. Firm size used as a control variable is found to be significantly positively correlated with financial leverage, while profitability (ROA) is found to be negatively correlated. For the second hypothesis tested, results show that managerial ownership and foreign ownership are significantly positively related to corporate dividend policy, while block holder ownership and institutional ownership are negatively related to corporate dividend policy. Board size, firm value, all control variables (firm size, Tobin's Q and ROA) are found to be significantly positively correlated with dividend yield.The empirical findings suggest that board size and ownership structure playing an important role and influence their power in deciding the Egyptian corporate financial decisions regarding the financial leverage and dividend decisions.

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The mediating effect of leverage and dividend policy on the influence of corporate governance towards firm value

Cited by 9 publications

References 15 publications

Antecedents and Outcomes of Corporate Governance: Evidence from Indonesia

Antecedents and Outcomes of Corporate Governance: Evidence from Indonesia

Increasing Firm Value Based On External Governance And Modern Finance theory

The Effect of Ownership Structure, Board Size and Firm Value on Corporate Financial Leverage and Dividends Policy: An Applied Study

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