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Abstract:
The discourses on the role of Corporate Governance in company have been widely carried out. This proves that the importance of this role cannot be ignored even though in practice it is very dependent on how the company to implement it. Corporate Governance is also one of the most important factors in increasing the value of the company in addition to other factors such as the company's financial performance itself. This study aims at assessing corporate governance by the instrumentality of ratings for a sample of 42 banking sector companies listed on the Indonesia Stock Exchange (IDX) with annual reports in 2012-2016 with a purposive sampling method. This study used multiple regression analysis and the results noticed the lack of a statistically significant relationship between the corporate governance was proxied by managerial ownership and audit committees, and firm value. Meanwhile institutional ownership, independent board of commissioners have significant positive effects on firm value. Financial performance that is proxied by Net Interest Margin does not affect the value of the company, while the Capital Adequacy ratio and Return on Asset have a significant positive effect on firm value. The implication of this research is that investors and stakeholders should be aware that there is no strong relationships among quality of corporate governance, financial performance and value of firm.
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