Board of directors and bank performance: beyond agency theory

Salloum, Charbel; Bouri, Elie; Khalife, Danielle

doi:10.1504/ijbge.2013.057379

Cited by 6 publications

(6 citation statements)

References 83 publications

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“…Moreover, this study also offers important implications for policy makers in the UK to motivate them to issue codes that lead to appoint an optimal size of board of directors and independent directors on the board, since our results show a negative relationship between them. Furthermore, our study suggests that governance codes in the UK should include policies for having more women on the boards of the UK top FTSE listed firms as a result of the positive relationship that we found between firm performance and women on the board, which is in line with agency theory expectation (Jensen, 1993;Salloum et al, 2013).…”

Section: Discussionsupporting

confidence: 84%

Internal corporate governance mechanisms and financial performance: evidence from the UK's top FTSE 100 listed companies

Elmghaamez

Akintoye

2021

IJBGE

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This paper examines the relationship between internal corporate governance mechanisms and the financial performance of the UK's top FTSE 100 firms listed on the London Stock Exchange. By using a sample of 59 firms from the top FTSE 100 firms over the period from 2013 to 2018, our findings demonstrated that the lower number of board size and independent directors on the board, the better financial performance of the UK's top FTSE 100 listed firms. However, our study revealed that better financial performance is positively correlated with greater proportion of women on boards. Additionally, we found that board meeting is insignificantly associated with the financial performance of listed firms. This study has important implications for policy makers in the UK to have more women on boards and to decrease board size and the number of independent directors to the optimal size, since there is no one size fits all firms.

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Section: Discussionsupporting

confidence: 84%

Internal corporate governance mechanisms and financial performance: evidence from the UK's top FTSE 100 listed companies

Elmghaamez

Akintoye

2021

IJBGE

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“…The size of the bank, however, does not have any effect on bank performance. The same result was also found by Salloum et al (2013) in research of 54 banks in Lebanon from 2005 to 2010. It reveals that the presence of outside directors has no statistical impact on the performance of banks.…”

Section: Hypothesissupporting

confidence: 85%

The effect of corporate governance's application on banks' performance: empirical study of banks listed on the Indonesian Stock Exchange

Irma

Idrus

2017

IJMEF

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This study aimed to examine the effect of corporate governance indicators, e.g., the board of directors, audit committee, and audit quality on bank's performance. This study used 30 banks listed on the Indonesia Stock Exchange (IDX) in the year of 2009-2010 as samples. The results reveal that the board of directors as one of the corporate governance indicators has a significantly positive correlation to banks' performance. As for the audit committee indicator, the result reveals a positive but insignificant effect on banks' performance. Meanwhile, a corporate governance indicator of audit quality has a significant positive relationship to the performance of the bank. This is consistent with the previous studies. It is concluded that the higher or better functioning the board of directors, audit committee and audit quality in the bank, the better the performance of the bank.

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“…All these studies have focused on examining the relationship between CG and firm financial value (measured mainly by ROA and ROE) rather than market value (proxied usually by Tobin's q). Additionally, Salloum et al (2013) concluded that the existence of outside directors and CEO duality appeared to have no impact on banks performance in Lebanon.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

How corporate governance affect firm value and profitability Evidence from Saudi financial and non-financial listed firms

Gerged

Agwili

2020

IJBGE

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This paper investigates the possible effects of corporate governance (CG) mechanisms on the firm market and accounting value (FV) in Saudi Arabia after the 2011 CG reforms using a sample of 300 annual reports of financial and non-financial companies listed on Tadawul from 2012 to 2016. Our results are suggestive of heterogeneous effects of CG mechanisms on firm value and profitability in that they might have either encouraged or discouraged FV in Saudi Arabia. This means that, averagely, better-governed firms tend to achieve better market value, but not necessarily a better accounting value. Our findings indicate that implementing a voluntary 'comply-or-explain' CG regime in Saudi Arabia has, so far, a limited impact on FV. This implies that developing other enforcement mechanisms for CG provisions, such as appending good CG practices to listing rules for companies to comply with, might lead to better financial results for those well-governed companies in Saudi Arabia. Despite the limitations, it is hoped that our study can inspire further examinations in this research area.

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Board of directors and bank performance: beyond agency theory

Cited by 6 publications

References 83 publications

Internal corporate governance mechanisms and financial performance: evidence from the UK's top FTSE 100 listed companies

Internal corporate governance mechanisms and financial performance: evidence from the UK's top FTSE 100 listed companies

The effect of corporate governance's application on banks' performance: empirical study of banks listed on the Indonesian Stock Exchange

How corporate governance affect firm value and profitability Evidence from Saudi financial and non-financial listed firms

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