The Influence of Good Corporate Governance and Political Connections on Company Value with Financial Performance as an Intervening Variable

Abstract

Company value is a very important benchmark for a company's performance. This assessment is very important because it influences investment decisions, managerial policies and company plans to increase competitiveness in the global market. Various factors can influence company value, both internal and external. Internal factors include financial performance and good corporate governance. This study aims to investigate and analyse the influence of Good Corporate Governance and political connections on corporate value, with financial performance as a mediating variable, in state-owned enterprises listed on the Indonesia Stock Exchange from 2021 to 2024. The study population consists of 65 companies, with a purposive sampling method yielding a sample size of 13 companies. Data analysis was conducted using the Structural Equation Model (SEM) variant PLS (Partial Least Square) 4. The results of the study indicate that Good Corporate Governance, proxied by the Board of Commissioners, and political connections do not influence financial performance and company value. Financial performance cannot influence company value, and financial performance, proxied by Return on Assets, cannot mediate the relationship between the Board of Commissioners and political connections on company value.