Corporate Governance and Firms Value: From the Board Diversity and Board Compensation Perspective

Nadia Khairani, Devianti Yunita Harahap

2017

Abstract

Recently, as markets globalize, listed companies in Indonesia must look ahead and find the ways to boost value for their shareholders. This study investigates the impact of board diversity and board compensation as the proxy of corporate governance to firm’s value. We used 216 companies listed in the IDX that disclosed the relevant information about the member of board of commissioners. We propose board diversity (gender, accounting background education or certification, foreigner and age); and board compensation (percentage of the commissioner’s compensations among the company’s net income before tax); will affect the firm’s value (Tobin’s Q). The study employs regression analysis to investigate the empirical data. The result proved the board of commissioners’ gender and age did not increase firm’s value, meanwhile other indicators as accounting background education or certification and foreigner did increase the firm’s value. We proved that the board compensation did significantly increase the firm’s value.

Paper Citation

in Harvard Style

Khairani N. and Yunita Harahap D. (2017). Corporate Governance and Firms Value: From the Board Diversity and Board Compensation Perspective .In Proceedings of the 2nd International Conference on Economic Education and Entrepreneurship - Volume 1: ICEEE, ISBN 978-989-758-308-7, pages 470-478. DOI: 10.5220/0006888104700478

in Bibtex Style

@conference{iceee17,
author={Nadia Khairani and Devianti Yunita Harahap},
title={Corporate Governance and Firms Value: From the Board Diversity and Board Compensation Perspective },
booktitle={Proceedings of the 2nd International Conference on Economic Education and Entrepreneurship - Volume 1: ICEEE,},
year={2017},
pages={470-478},
publisher={SciTePress},
organization={INSTICC},
doi={10.5220/0006888104700478},
isbn={978-989-758-308-7},
}

in EndNote Style

TY - CONF

JO - Proceedings of the 2nd International Conference on Economic Education and Entrepreneurship - Volume 1: ICEEE,
TI - Corporate Governance and Firms Value: From the Board Diversity and Board Compensation Perspective
SN - 978-989-758-308-7
AU - Khairani N.
AU - Yunita Harahap D.
PY - 2017
SP - 470
EP - 478
DO - 10.5220/0006888104700478