THE EFFECT OF GOOD CORPORATE GOVERNANCE AND PROFITABILITY ON COMPANY VALUE AT PT JAPFA COMFEED INDONESIA TBK (2015-2024)

Abstract

This study aims to know Good Corporate Governance (GCG) and profitability jointly influence firm value in the context of a leading Indonesian agribusiness company, PT Japfa Comfeed Indonesia Tbk, over a ten-year period (2015–2024). Using secondary data sourced from annual reports and financial statements, we employ multiple linear regression to test three hypotheses derived from agency theory and stakeholder theory. GCG is operationalized through a composite index based on board independence, the existence of an audit committee, and meeting frequency; profitability is measured by Return on Equity (ROE); and firm value is proxied by Price to Book Value (PBV). The findings indicate that while profitability exerts a statistically significant positive effect on firm value (β = 0.075, p = 0.041), GCG alone does not exhibit a significant impact (β = –0.140, p = 0.480). However, an F-test confirmed that the two variables together significantly explained 48% of the variation in firm value (Adjusted R² = 0.480, p = 0.042). These results suggest that investors in the Indonesian agribusiness sector prioritize short-term financial performance, but governance quality remains relevant as part of a broader value creation framework. This study provides empirical evidence from a single-firm longitudinal design in an under-researched industry and offers practical insights for corporate leaders and investors.