Intellectual Capital Performance, Enterprise Risk Management, Financial Performance and Firm Value of Islamic Companies in Indonesia

Abstract

The aim of this paper is to empirically test the influence of intellectual capital performance (ICP) and enterprise risk management (ERM) to firm’s value through financial performance. Samples was drawn from Indonesian public companies indexed by JII (Jakarta Islamic Index) 2016. ICP was measured with MVAIC, a new comprehensive tool in determining IC developed by Ulum (2015).  Warp PLS 6.0 was used to analyze the data. The results indicated that directly, both ICP and ERM affect positively (P<0.01) to firm value (measured with price to book value/PBV). When tested with mediator, it was seen that financial performance (measured by ROA and ROE) mediates the relationship between ICP and firm valau and also ERM and firm value. In addition, as expected and proven, there are high level influence of ICP and ERM to financial performance, significant level <0.01 and R-squared = 0.25.