An analysis of the influence of corporate social responsibility, good corporate governance, and profitability on firm value

Abstract

Purpose – This study aims to investigate the influence of Corporate Social Responsibility (CSR), Good Corporate Governance (GCG), and profitability on firm value, utilizing multiple proxies to capture the multidimensional nature of governance.

Design/methodology/approach – The sample comprises manufacturing companies listed on the Indonesia Stock Exchange from 2019 to 2021, selected through purposive sampling. Secondary data extracted from annual reports were analyzed using panel data regression with EViews 10.

Findings – The empirical results reveal that CSR, profitability, and GCG proxied by institutional ownership exert a significant positive influence on firm value. In contrast, other GCG proxies—namely the audit committee, managerial ownership, and the independent board of commissioners—do not exhibit a significant direct effect on firm value.

Originality/value – This research contributes novel empirical evidence by disaggregating GCG mechanisms within the Indonesian manufacturing context during the post-pandemic period. The findings underscore that not all governance practices are equally value-relevant, providing actionable insights for policymakers and corporate strategists seeking to optimize governance structures and stakeholder engagement to enhance market valuation.