Signaling Theory Basic of Theoretical

17 5. Fairness In conducting its activities, the company must always take into consideration the interests of shareholders and other stakeholders based on the principles of fairness and equality. According to the Forum for Corporate Governance in Indonesia 2011, the delivery of good corporate governance, should be supported by the availability of: 1. The number of independent directors is at least 30 of the total number of commissioners. 2. Importance formed audit committee. 3. Need formed corporate secretary. In order to achieve good corporate governance, we need a way or mechanism. Corporate governance mechanism is the way a company or applied to achieve good corporate governance. According Syakhroza 2005: 14, in the area of controlling, corporate governance mechanism is divided into two, namely internal corporate governance mechanism and external corporate governance mechanism. Corporate governance mechanism is internal is an interaction between the parties to the decision makers in the company that includes the Board of Directors, Board of commissioner, executive management that includes audit committee, and the General Meeting of Shareholders AGM Petrolia, 2007: 127. Internal corporate governance mechanisms 18 designed to align the interests of managers and shareholders. The board of directors of public companies responsible for the development and implementation of this mechanism Gunarsih, 2003: 160. Kim and Nofsinger 2004 in Petronila 2007: 127, states that the internal mechanism starting from accounting units that generate financial reports and internal auditors who assess the financial reporting process. External control mechanism is the control of the company conducted by the market Gunarsih, 2003: 160. Corporate governance mechanism that is external is the interaction between the parties which oversees the performance of the company, among other stakeholders employees, customers, suppliers, creditors, communities and reputational agents accountants, lawyers, rating agency credit, investment manager Kim and Nofsinger 2004 in Petrolina, 2007: 127.

a. Board of Commissioners BoC

According to Law No. 40 of 2007 on limited liability companies, the companys board of directors is the organ that is in charge of supervising both generally and specifically in accordance with the statutes and provide advice to the board of directors. Board of commissioner BoC as the organ in charge of the company and is collectively responsible for overseeing and advising the Board of Directors and ensuring that companies implement Good Corporate Governance. However, the board should not be participating in making