The Role of Risk and Sustainability Management in the Effects of Corporate Governance on Firm Value
This study analyzes both of directly effects between corporate governance on firm value and indirectly effect through enterprise risk management and sustainability management.Subjects of this study were all the manufacture company listed in Indonesia Stock Exchange (IDX) Based on population criteria stated previously the total population was 24 companies.Result of this study revealthat improving corporate governance would led to increased enterprise risk management, sustainability management, and firm value.In the other hand, enterprise risk management have inversely effect on firm value and sustainability management have no significant effect on firm value. Enterprise risk management have negative mediating role in effect of corporate governance on firm value, otherwise sustainability are not. The study also make categorization for each index of Corporate Governance (CG) Enterprise Risk Management (ERM) and Sustainability Management (SM) and compare it with same sector industry and overall industry in manufacture with categories"above" and "below"rate. The quality of CG, ERM, and SM practices in each manufacture companies have been improved during 2011 to 2013 period. The finding show that the bigger companies with market categorization up to IDR 90 trillion which have above rate category doing the better implementation of CG and ERM than the companies which have market capitalization less to IDR 90 trillion, but it was not for their SM implementation. Results and findings of the study are discussed with suggestion for future research, which include the need of developing proxy in conceptual model analyzed and using the market capitalization based on its criterion.