Corporate governance and efficiency in banking: evidence from emerging economies

Andrieş, Alin Marius; Căpraru, Bogdan; Nistor, Simona

doi:10.1080/00036846.2018.1436144

Cited by 41 publications

(32 citation statements)

References 53 publications

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“…With the aim of assessing the evolution of bank boards in the Indian banking, the study employs data on 14 attributes of a board and formulates a comprehensive index for board governance. Following studies such as Tarchouna et al (2017) and Andrieș et al (2018), we apply the PCA process to allocate relative weights to different characteristics of governance. PCA apportions endogenous weights and does not use subjective judgement to decide on relative weights (Tetlock, 2007).…”

Section: Construction Of the Board Index: Estimation Methodologymentioning

confidence: 99%

“…Second, the majority of the researchers have employed an unweighted method to construct a corporate governance index, which implicitly implies that weights are equal to 1, ignoring the fact that all governance components may not be equally relevant. A few recent studies have employed statistical methods for computing weights, such as PCA (e.g., Andrieș et al, 2018;Black et al, 2014;Tarchouna et al, 2017). For Indian banking, to the best of our knowledge, so far no significant study has examined the evolution of practices related to board governance.…”

Section: Literature Reviewmentioning

confidence: 99%

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Assessing the Quality of Bank Boards: Evidence from the Indian Banking Industry

Bhatia

Gulati

2020

Margin: The Journal of Applied Economic Research

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The article employs hand-collected data on 14 board characteristics for the period from 2004–2005 to 2016–2017 to empirically assess the evolution of board governance practices in the Indian banking industry. For this, we construct a comprehensive index for board governance and four sub-indices of board effectiveness. The study sheds light on how various characteristics of Indian bank boards have evolved over time. The mean value of the board index rose 33 per cent during the period of analysis, indicating a significant improvement in board governance practices of banks. The improvement in practices is primarily due to a considerable transition in the sub-dimensions of board structures and board independence. The transition in board structure results from the larger number of banks appointing different persons as CEOs and chairpersons; the change in board independence has principally emanated from the larger number of banks providing training to their independent directors, declarations and conducting separate meetings. Yet, our findings recommend room for further improvement in various aspects of board governance, including appointment of non-executive chairpersons, female directors and board independence. JEL Classification: G21, G34, C23

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Section: Construction Of the Board Index: Estimation Methodologymentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Assessing the Quality of Bank Boards: Evidence from the Indian Banking Industry

Bhatia

Gulati

2020

Margin: The Journal of Applied Economic Research

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“…These issues pertain to: (i) the choice of indicators/dimensions for the construction of aggregate index, and (ii) index methodology for aggregation of indicators/dimensions. Most of the researchers relied on a self-structured framework, which is based on one or few sets of principle dimensions of corporate governance for the construction of composite index (see, for instance, Song and Li 2012; Ellul and Yerramilli 2013; Love and Rachinsky 2015; Zagorchev and Gao 2015; Andries et al 2018). There are also some studies where researchers used a structured framework developed by third-party (generally the rating agencies) to obtain composite indices for measuring the strength and quality of governance in banking firms.…”

Section: Corporate Governance In Banking: a Relevant Literature Reviewmentioning

confidence: 99%

A non-parametric index of corporate governance in the banking industry: An application to Indian data

Gulati

Kattumuri

Kumar

2020

Socio-Economic Planning Sciences

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This paper presents a methodological framework for constructing a non-parametric index of corporate governance for banks. The index is constructed by aggregating six distinct dimensional indices capturing different dimensions of corporate governance, namely board effectiveness, audit function, risk management, remuneration, shareholder rights and information, and disclosure and transparency. For aggregation, a tailored version of data envelopment analysis (DEA) approach which is popularly known as constrained 'Benefit-of-the-Doubt (BoD)' model is employed. This approach is unique and distinctive in the sense that it requires no a priori knowledge of weights, and assigns endogenous weights obtained from actual data to individual dimensions of bank governance in order to construct a composite index of corporate governance. This methodological framework has illustrated by applying it for a data set of 40 Indian banks operating in the year 2017. The data set has been compiled using 58 governance regulations as defined by relevant jurisdictions.

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“…The World Bank described that corporate governance should be based on four "pillars" -Responsibility, Accountability, Fairness and Transparency (RAFT). Similarly, corporate governance can be defined as the relationship among shareholders, board of directors and the top management in determining the direction and performance of the corporation (Wheelen and Hunger, 2006 Andries, Capraru, Mutu [23] investigated that "the link between corporate governance and bank efficiency has been analyzed by very few studies with inconclusive results.…”

Section: Review Of Literaturementioning

confidence: 99%

Banking Sector’s Corporate Governance Practices: Study on Rangpur Region in Bangladesh

Hossin

Biva

2020

AJEBA

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This research paper is an endeavor to look at the present status of corporate governance in banking sector of Bangladesh. Corporate Governance ensures to bring transparency, accountability and professionalism within the management system of a company body that enhances the credibility and acceptability to the shareholders, employees, potential investors, customers, lenders, governments and every one other stakeholder. This is often truer just in case of banking system. To serve the study, both primary and secondary data are wont to prepare this paper. Samples are collected on the premise of questionnaire by interviewing 10 randomly selected bank personnel like corporate branch manager and other concerned personnel. So as try to the study; the main issues were focused like shareholder rights and disclosure of knowledge, disclosure and transparency, board issues, audit practices, financial reporting and Human Resources Management (HRM) practices. Seven hypotheses are developed so as to spot whether banks are complying corporate governance issues or not. To estimate the idea, statistical tools like mean, variance and Z-test are used. Hypotheses for the study are developed from the research questions. The results and analysis indicate compliance of CG code within the banks is above 70% and also the assumption of the 6 hypothesis only 50%. Consequently, the study recommends greater regulatory monitoring to confirm the exercise of fine governance in Bangladeshi Banks.

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Corporate governance and efficiency in banking: evidence from emerging economies

Cited by 41 publications

References 53 publications

Assessing the Quality of Bank Boards: Evidence from the Indian Banking Industry

Assessing the Quality of Bank Boards: Evidence from the Indian Banking Industry

A non-parametric index of corporate governance in the banking industry: An application to Indian data

Banking Sector’s Corporate Governance Practices: Study on Rangpur Region in Bangladesh

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