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Research Paper | Public Policy | Indonesia | Volume 10 Issue 7, July 2021 | Popularity: 4.8 / 10

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The Effect of Enterprise Risk Management (ERM) on Firm Value (Case Study of BUMN Companies Listed on the Indonesia Stock Exchange (IDX) for the Period of 2015-2019)

Nuralamsyah Ismail, Chandra Wijaya

Abstract: Currently, the development of policies was so rapid and underwent many changes that increased the urgency of public policy in the context of the governance process. One of the Public Institutions is State-Owned Enterprises (BUMN) whose operational activities represent state ownership. The presence of Enterprise Risk Management (ERM) is believed by many studies to increase the value of a firm, so that it is also expected to apply to BUMN companies in Indonesia. This study aims to determine and analyze the influence of Enterprise Risk Management (ERM) on firm value. With the control variables consisting of Managerial Ownership, Return of Assets (ROA), and Firm Size. The research sample is state-owned companies listed on the Indonesia Stock Exchange (IDX) for the period of 2015-2019. The method used in this study is Multiple Regression and Hypothesis Testing using T-test. The results of this study indicate that Enterprise Risk Management (ERM) has a positive and significant effect on the value of BUMN. Firm size has a significant effect but gives a negative coefficient. While the Return of Assets (ROA) provides a positive coefficient but does not have a significant effect. Managerial ownership has a negative effect on firm value.

Keywords: Enterprise Risk Management, Managerial Ownership, Return of Assets, Firm Value

Edition: Volume 10 Issue 7, July 2021

Pages: 82 - 86

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