The Role of The Board of Commissioners in Moderating The Relationships of Profitability, Capital Structure, and Investment Decisions With Firm Value
DOI:
10.47353/ecbis.v4i6.659Published:
2026-10-12Downloads
Abstract
This study aims to analyze the effects of profitability, capital structure, and investment decisions on firm value and to examine the role of the board of commissioners in moderating these relationships. The study employs a quantitative approach using secondary data in the form of financial statements and company data of firms included in the LQ-45 Index of the Indonesia Stock Exchange during 2020–2024. The sample was determined using purposive sampling, resulting in 125 observations from 25 companies. Data were analyzed using Moderated Regression Analysis (MRA) to examine the direct effects and the moderating effects of the board of commissioners on firm value. The results show that profitability has a negative and significant effect on firm value, whereas capital structure has a positive and significant effect on firm value. Investment decisions have no significant effect on firm value. The board of commissioners has a positive effect on firm value. Furthermore, the board of commissioners negatively moderates the relationship between profitability and firm value and positively moderates the relationship between capital structure and firm value. However, the board of commissioners does not significantly moderate the relationship between investment decisions and firm value. These findings indicate that the role of the board of commissioners in enhancing firm value is not uniform across different financial decisions. The findings imply that the effectiveness of the oversight mechanism needs to be considered in relation to the characteristics of corporate financial decisions.
Keywords: profitability; capital structure; investment decisions; firm value; board of commissioners
Keywords:
profitability Capital Structure Investment decision Firm Value Board of CommissionersReferences
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Copyright (c) 2026 Trisnandi Kuswara Pambudiharma , Ikhsan Budi Riharjo
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