The Effect of Good Corporate Governance Mechanism on Firm Value of Indonesian Socially Responsible Firms

Firm value is important information in investment decisions. Therefore, it is necessary to investigate further the relationship between firms' corporate governance and corporate social responsibility. This study aims to analyze the effect of Good Corporate Governance mechanism (as proxied by the frequency of joint meetings between boards of commissioners and directors and the frequency of boards of commissioners and directors' meeting attendance) on firm value with Corporate Social Responsibility (CSR) as the intervening variable. We generate our data from the annual reports of firms listed in the SRI-KEHATI Index in 2014-2016. Using Partial Least Square, we show that CSR cannot mediate the relationship between GCG and firm value. Meanwhile, CSR is only affected by joint board meetings. Lastly, board meeting attendance directly affects firm value.