PENGARUH GOOD CORPORATE GOVERNANCE TERHADAP REAKSI PASAR: KINERJA KEUANGAN SEBAGAI VARIABELMODERATING

Abstract

Thepurpose of this research is to test the influence of Good Corporate Governance which consists of independent
commissioner, managerial ownership, institutional ownership, and audit quality to the market reaction with the
financial performance as the moderating variable which has been done by the manufacturing companies in
Indonesia. The result of the research shows that GCG which is independent commissioner has an influence to the
market reaction, it means that the market accept the signal about the implementation of GCG in the company
and it overestimates by giving high premium for the share price of the company. Meanwhile, the managerial
ownership, the institutional ownership and the audit quality do not have any influence to the market reaction.
The GCG in this case the independent commissioner, the managerial ownership, the institutional ownership and
the audit quality have influence to the financial performance whereas the managerial ownership does not have
any influence to the financial performance. The GCG in this case the independent commissioner has influence to
the market reaction through the financial performance, it means that the company a respond from the market
since the investors who are going to purchase the shares are tend to be more interested in the company which has
high profitability. Meanwhile, the managerial ownership, institutional ownership and audit quality variables do
not have any influence to the market reaction even though it has been moderated by the financial performance
variable.
Keywords: good corporate governance, market reaction, financial performance.