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

Abstract

This study aims to examine the effect of good corporate governance, profitability, and company size on firm value among the most actively traded companies listed on the Indonesia Stock Exchange (IDX) during the 2015–2019 period. The population consists of companies included in the LQ45 index, with samples selected using purposive sampling. Data were analyzed using multiple linear regression analysis. The findings indicate that institutional ownership and profitability have a significant positive effect on firm value, while the proportion of the board of commissioners and company size have a significant negative effect on firm value. The Adjusted R² value of 0.482 indicates that 48.2% of the variation in firm value can be explained by institutional ownership, proportion of the board of commissioners, profitability, and company size, while the remaining 51.8% is influenced by other factors not examined in this study.