Sharia governance and firm value: The mediation role of strategic leverage and financial performance in consumer goods sector companies in the Indonesian Sharia Stock Index

Abstrak

The purpose of this study is to examine and analyze the role of leverage and financial performance in mediating Sharia governance on firm value (a study of the consumer goods sector listed on the Indonesian Sharia Stock Index for the 2021-2024 period). The study population consisted of 4,493 data observations, with a sample of 43 companies using a purposive sampling method. Data were analyzed using panel data regression and mediation tests to test the research hypotheses. The mediation hypothesis was tested using the Sobel test or path analysis. All data analysis was performed using Eviews 13 software. The data source used in this study was secondary data, in the form of annual reports of the sample companies published on their respective websites or by the Indonesia Stock Exchange. Sharia governance was measured using the board of directors. Leverage was measured using the debt-to-assets ratio. Financial performance was measured using the return on equity indicator, while firm value was measured using the earnings per share indicator. The results of this study found that leverage can mediate the effect of Sharia governance on firm value; financial performance can mediate the influence of Sharia governance on firm value; Sharia governance has a negative and significant effect on leverage; Sharia governance has a negative but not significant effect on financial performance; Sharia governance has a positive and significant effect on firm value; leverage has a negative and significant effect on firm value; and financial performance has a positive and significant effect on firm value.

Kata kunci

• Financial performance
• Firm Value
• Sharia Governance
• leverage