Board of directors’ effects on financial distress evidence of family owned businesses in Lebanon

Salloum, Charbel; Azoury, Nehme; Azzi, Tarek

doi:10.1007/s11365-011-0209-9

Cited by 44 publications

(45 citation statements)

References 25 publications

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“…Also, Greuning and Bratanovic (2004) indicate that a board of directors with a strong president who doesn't manage the activity of the bank has certainly a sound influence on the bank's policy than a board whose chairman is also the CEO. Salloum, Azoury, and Azzi (2011) indicate that CEO duality negatively affects the power of the board and makes it less effective. This monopoly power may increase conflicts of interest between managers seeking to maximize their utility function and shareholders seeking to maximize the wealth of the firm.…”

Section: Ceo Duality and Bank Credit Riskmentioning

confidence: 99%

The Influence of Internal Corporate Governance on Bank Credit Risk: An Empirical Analysis for Tunisia

Moussa

2019

Global Business Review

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Bank governance has received special attention after the financial crises of 2008 that have occurred. Nevertheless, the literature presents seemingly conflicting evidence on the implications of governance for bank credit risk quality. The purpose of this article is to examine the impact of corporate governance variables of board size, board composition and board gender diversity on credit risk. Panel data regression analysis is applied to a sample of listed banks from the Tunisia during the 2000-2014 period. We improve the robustness of our results by employing four measures of credit risk commonly used in the literature as the dependent variable in our study. Our results show that the higher the number of board members, the lower the quality of credit is and, consequently, the credit risk increases. The concentration of power within the board of directors may increase bank risks when the cumulative functions of CEO and chairman negatively affect the weight of the board and make it less effective. Also, our findings highlight the importance of board independence and the presence of foreign directors in enhancing credit quality. Nevertheless, we document that the NPLs ratio increases and NPL coverage ratio decreases in the presence of state directors. Finally, we find evidence that the presence of a woman on board influences credit risk, as it is argued that female directors may differ from male directors with regard to their risk attitude, and this, in turn, may influence board's monitoring ability and its decision-making process. Therefore, this evidence provides beneficial information for supervising authorities, stakeholders and academics, and banks should take this into account during the composition of their board of directors.

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Section: Ceo Duality and Bank Credit Riskmentioning

confidence: 99%

The Influence of Internal Corporate Governance on Bank Credit Risk: An Empirical Analysis for Tunisia

Moussa

2019

Global Business Review

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“…1.-Number of Board Directors (NBOARD). A large board is associated with an ineffective monitoring role (Salloum, Azoury and Azzi, 2013), which can facilitate that managers avoid debt maturity structures that enable frequent monitoring (STL).…”

Section: Control Variablesmentioning

confidence: 99%

Corporate governance attributes and listed SMES’ debt maturity

Briozzo

Cardone‐Riportella

Olalla

2019

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Purpose This paper aims to develop a cross-country analysis of the similarities and differences in the debt maturity structure of listed SMEs from the point of view of corporate governance (CG) attributes in two different economic environments: an OECD (Spain) country and a non-OECD (Argentina) country. Design/methodology/approach Using data from listed SMEs in the Argentinian SME segment (pooled data from 2012 to 2015) and 31 listed SMEs in the Spanish Mercado Alternativo Bursátil for growing firms (MAB_GE)(2014), bivariate and multivariate analyses are performed. Findings Spanish firms with a higher ownership concentration and a large controlling shareholder have higher short-term liabilities (STL) ratios. Participation of women on the board has a negative relation with the STL ratio only for Spain. The participation of corporations in ownership and a Big4 auditor have a negative relation with the STL ratio for both countries. Practical implications These results will help SME managers understand the effects of the application of good governance policies. The study also gives regulators a guideline to develop standards to assist in efficient borrowing in terms of seeking funding in alternative capital markets. Originality/value First, the results provide evidence about the financial impact on the STL ratio of CG attributes in listed SME. Second, as far as the authors know, this is the first paper to analyse the CG attributes of listed SMEs in an OECD country and a non-OECD country. Third, the paper presents CG data derived from an ad hoc basis elaborated from different websites and databases.

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“…The increased representation of women on corporate boards is a distinct trend in the western business community. Different values, personalities and skill sets aligning with the different genders may lead to the adoption of different methods for decision making and leadership styles, which may have significant implications for board operations and function [3,4]. However, while this trend is a milestone for gender equality, does it really have any impact on a firm's performance and corporate governance?…”

Section: Introductionmentioning

confidence: 99%

Does Board Gender Diversity Bring Better Financial and Governance Performances? An Empirical Investigation of Cases in Taiwan

Wang

2020

Sustainability

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Gender diversity, one of the core streams of top management team (TMT) diversity research, poses a theoretical argument valuable for firms—whether gender diversity among board members can lead to improved performance. Increased research attention on the relationship between gender diversity and the financial and governance performance of firms has produced inconclusive results. This study shapes the gender diversity of corporate boards by defining six compounding elements, which is the major contributor to the literature of gender diversity. This study aims to provide a more complete and precise assessment of the impact of gender diversity on a firm’s performance and corporate governance performance from the Taiwanese experience. The evidence in Taiwan suggests that increased board gender diversity does not have a positive effect on financial and governance performance. Only the ratio of female independent directors is found to have a significantly positive association with a firm’s performance, supporting prior findings that directors with greater independence are better able to perform their monitoring function and thus contribute to performance. The results also demonstrate that female directors having concurrent posts is a critical factor in enhancing corporate governance performance. Female directors with prior experience as serving directors or supervisors in other companies can offer diverse opinions and network ties, thus contributing to improved cohesion and corporate governance. The findings of this research can contribute to both literature and practice in board gender diversity issues and can serve as an empirical basis for enterprises in optimizing their board composition.

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Board of directors’ effects on financial distress evidence of family owned businesses in Lebanon

Cited by 44 publications

References 25 publications

The Influence of Internal Corporate Governance on Bank Credit Risk: An Empirical Analysis for Tunisia

The Influence of Internal Corporate Governance on Bank Credit Risk: An Empirical Analysis for Tunisia

Corporate governance attributes and listed SMES’ debt maturity

Does Board Gender Diversity Bring Better Financial and Governance Performances? An Empirical Investigation of Cases in Taiwan

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