scholarly journals The Influence of Internal Auditing on Effective Corporate Governance in the Banking Sector in Oman

2018 ◽  
Vol 14 (7) ◽  
pp. 257 ◽  
Author(s):  
Zaroug Osman Bilal ◽  
Omar Igbal Twafik ◽  
Anaam Khamis Bakhit
Keyword(s):  
Corporate Governance ◽  
Quality Assurance ◽  
Commercial Banks ◽  
Banking Sector ◽  
Internal Audit ◽  
Securities Market ◽  
Improvement Program ◽  
Professional Care ◽  
Audit Activity ◽  
Audit Independence

This research aims to examine the influence of internal audit on effective corporate governance in commercial banks listed on Muscat Securities Market (MSM) in Oman. A questionnaire was used to collect data and was distributed to the 100 top senior level officials and internal audit department of the commercial banks. The regression model that was used in this study was five dependent variables: internal audit independence; proficiency and due professional care; nature of work; quality assurance and improvement program; and managing the internal audit activity. The finding of the research establishes a significant positive relationship between internal audit and effective corporate governance. Variables internal audit independence, proficiency and due professional care, and nature of work were significantly associated with corporate governance. For quality assurance and improvement program and managing the internal audit activity, their influence on corporate governance is not statistically significant.

The Relationship Between CAE Leadership and the IAF’s Involvement in Corporate Governance

2019 ◽  
pp. 0148558X1986753
Author(s):  
Pierluigi Martino ◽  
Giuseppe D’Onza ◽  
Robert Melville
Keyword(s):  
South Africa ◽  
Corporate Governance ◽  
Quality Assurance ◽  
Leadership Training ◽  
Leadership Skills ◽  
Internal Audit ◽  
Activity Type ◽  
Improvement Program ◽  
Internal Audit Function ◽  
The Relationship

This article examines the importance of leadership in the context of the internal audit function (IAF). We investigate the influence of the Chief Audit Executive’s (CAE) leadership in enabling the IAF to become a strategic player in corporate governance (CG). Using the responses of 804 CAEs from the Anglosphere countries and South Africa, we find that strong CAE leadership skills and the existence of a leadership training program are significantly and positively associated with IAF involvement in CG processes. This provides support for the argument that CAEs with strong leadership skills help the IAF to move from a behind-the-scenes player to a key actor in the improvement of CG practices, increasing the IAF’s organizational relevance. We also find that the use of a risk-based audit plan, the existence of a quality assurance and improvement program (QAIP), activity type (consulting vs. assurance), and IAF size are also positively associated with IAF involvement in CG. These findings suggest that IAF activity characteristics also have significant implications for this function’s stronger involvement in the CG space.

scholarly journals The Effect of Multiple Large Shareholders on Banks’ Profitability and Risk

2021 ◽  
Vol 13 (4) ◽  
pp. 1888
Author(s):  
Maria Gaia Soana ◽  
Laura Barbieri ◽  
Andrea Lippi ◽  
Simone Rossi
Keyword(s):  
Corporate Governance ◽  
Commercial Banks ◽  
Banking Sector ◽  
Positive Impact ◽  
Corporate Structure ◽  
Academic Literature ◽  
Large Shareholders ◽  
Bank Ownership ◽  
Institutional Shareholders

The wide-ranging academic literature on corporate governance in the banking sector includes only a few studies on bank ownership and, specifically, on the comparative power of shareholders within the corporate structure. This paper reports an investigation into the presence of multiple large shareholders and their influence on profitability and risk in the long-term, considering a sample of 697 U.S. and European listed commercial banks from 2008 to 2018. It was found that the number of large and institutional shareholders has a positive impact on profitability, but no effect on risk. However, long-term ownership by multiple large shareholders contributes to decreasing risk in banks.

scholarly journals Corporate governance practices in the banking sector of Bangladesh: do they really matter?

2017 ◽  
Vol 12 (1) ◽  
pp. 27-35 ◽  
Author(s):  
Samiul Parvez Ahmed ◽  
Rahatul Zannat ◽  
Sarwar Uddin Ahmed
Keyword(s):  
Corporate Governance ◽  
Commercial Banks ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Stock Exchange ◽  
Financial Sector ◽  
Jel Classification ◽  
Data Availability ◽  
Time Period ◽  
Governance Practices

A well governed institution is expected to use its resources optimally and, thus, perform more efficiently and contribute positively to economic development of a nation. However, often, it can be seen that poor management of the stakeholders leads to less than optimal strategic directions for an institution. Due to recent global financial crisis and rising issues of the Bangladeshi banking sector, corporate governance is one of the factors that have gained considerable attention. Recent drive of the governance issues of the banking sector of Bangladesh is expected to bring positive change in the financial sector and, hence, it is crucial to assess whether complying with governance codes leads to desired outcome or not. Specifically, the main purpose of this study is to examine the relationship between performances of commercial banks with corporate governance factor along with some internal and macroeconomic variables. Thus, the listed commercial banks in the Dhaka Stock Exchange (DSE) of Bangladesh were considered for the study. Subsequently, considering data availability of the time period (2011-2014), 29 listed commercial banks in the DSE have been considered and, hence, Ordinary Least Squared (OLS) regression models were used through Eviews 8.0 for analyzing the data. Though the study shows a positive relation between corporate governance and performances of banks, the statistical insignificance of the relation raises concern regarding various issues of corporate governance in the financial sector of Bangladesh. Keywords: corporate governance, financial institutions, performances of commercial banks. JEL Classification: G21, G30, G38, G39, O16

scholarly journals The Impact of Corporate Governance on Profitability of Conventional Banks Operating in Pakistan

2020 ◽  
Vol 1 (4) ◽  
pp. 260-267
Author(s):  
Hafiz Muhammad Naveed ◽  
Shoaib Ali ◽  
Yao Hongxing ◽  
Saqib Altaf ◽  
Jan Muhammad Sohu
Keyword(s):  
Corporate Governance ◽  
Commercial Banks ◽  
Banking Sector ◽  
Board Independence ◽  
Return On Assets ◽  
Board Size ◽  
Return On Equity ◽  
Board Directors ◽  
Conventional Banks ◽  
The Impact

The key purpose of present research study to examine the association among corporate governance and profitability banks in developing counties. For such primary objective, annually based data collected from 2004 to 2016. The data taken from annual financial reports which issued by conventional banks.  We have used ADF (Augmented Dickey Fuller) test to examine the unit-root of variables. Moreover, the multiple linear regression utilized for hypothetical estimation. The results indicates that corporate governance and conventional banks profitability of Pakistan are bidirectional (positive-negative) associated to each other. In addition, the board size (Board Directors) is negatively associated with Return on assets and return on equity of banks. Similarly, the board independence (Insider-Outsider Board Directors) is positively influenced to return on assets and return on equity of conventional banks of Pakistan. The overall findings shows that board size and board independence are highly associated with return on equity than return on assets. Moreover, banking sector in developing countries the board size should contain on appropriate strength and acquire more professional and qualified staff. An optimal number of directors in a board size there is a need of commercial banks as to increase the profitability. To enhance the investors’ confidence with the bank there is also a need of the commercial banks to increases the board independency.

Corporate Governance Practices and Non-performing Loans of Banking Sector of Bangladesh: A Panel Data Analysis

2019 ◽  
Vol 9 (2) ◽  
pp. 12
Author(s):  
Asia Khatun ◽  
Ratan Ghosh
Keyword(s):  
Corporate Governance ◽  
Commercial Banks ◽  
Banking Sector ◽  
Good Governance ◽  
Panel Data Analysis ◽  
Random Effect ◽  
Developed Countries ◽  
Governance Practices ◽  
Code Of Corporate Governance

This paper tries to inspect the association and relationship between corporate governance determinants and level of non-performing loan (NPL) of listed commercial banks in Bangladesh. Recently Banks are facing a problem of default loan. This default loan or NPL may reduce the loan giving capacity of the Banks and it may decrease the economic growth of a country. Moreover, there is less research to find out the implication of good governance on the level of NPL in banking sector of Bangladesh than that of developed countries. Here, data from thirty listed commercial banks for the year 2008-2017 (10 years) are taken to explore the rapport between the corporate governance variables and NPL. Random Effect GLS regression method is used to analyze the data. Findings told that commercial banks follow the code of corporate governance on a comply basis however their relationship with NPL is positively significant within the taken determinants of corporate governance. It is expected that, banks with good quality management may ensure the quality of loan and it will reduce the level of NPL.

scholarly journals Corporate Governance, Risk Management and Ethical Investment: Evidence From Banking Industries

2019 ◽  
Vol 10 (5) ◽  
pp. 126
Author(s):  
Amzad Hossain ◽  
Farid A. Sobhani ◽  
Normah Omar ◽  
Norazida Mohamad ◽  
Jamaliah Said
Keyword(s):  
Risk Management ◽  
Corporate Governance ◽  
Board Of Directors ◽  
Management Practices ◽  
Banking Sector ◽  
Internal Audit ◽  
Ethical Investment ◽  
Responsible Investment ◽  
Good Corporate Governance ◽  
Governance Risk

Considering the importance of good corporate governance in the banking industry, the study has been designed to investigate the managerial perceptions on interrelationship among good corporate governance, risk management, and ethical investment of the commercial banks of Bangladesh. Bangladesh has been selected as a field of study for three reasons. Firstly, banking is the leading sector in Bangladesh. Secondly, banking sector has been highly criticized in the recent times due to Bangladesh Bank scandal. Thirdly, banking is gradually being challenging services in Bangladesh. As a financial intermediary, bank has to ensure good corporate governance for smooth operations and reducing agency problem. As a trustee, bank deals with the money of others through various schemes of investment. Ethical investment known as social responsible investment is an indicator of good corporate governance. A structured questionnaire has been used to gather perceptions of managers of the sample banks. The results suggest that the most important factors for effective CG were the board of directors, auditors and managers of the various departments. The study also finds that risk taking behavior of the bank is influenced by the direction of board of directors. In this study corporate governance variables have been categorized with some sub-indices. Board’s structure with independent directors and well communication with supervisors ensure the efficient risk management practices in the banks where internal audit system and transparent disclosures of the board ensure the ethical investment practices.

scholarly journals Effects of Corporate Governance on Financial Performance of Commercial Banks in Nigeria

2021 ◽  
Vol 2 (1) ◽  
pp. 13-23
Author(s):  
Panan Danladi Gwaison ◽  
Livinus Nkuri Maimako
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Commercial Banks ◽  
Audit Committee ◽  
Banking Sector ◽  
Stock Exchange ◽  
Gender Diversity ◽  
Governance Structure ◽  
Secondary Source ◽  
Least Squares Regression

In most developing countries, several cases of collapses or failure in the banking sector were witnessed. Nigeria had witnessed several cases and collapsed in the banking sector. This study investigated the effects of corporate governance on the financial performance of commercial banks in Nigeria. The study used the survey research design. A secondary source of data was used for this research. The data were collected from financial statements of the five (5) commercial banks selected from the Nigerian Stock Exchange listing for fourteen financial years (2003 – 2017). The study utilized the panel Least Squares Regression Analysis as the method. The result indicated that board size had significant effects on financial performance (ROA) of commercial banks in Nigeria, board composition had significant effects on financial performance (ROA) of commercial banks in Nigeria, board gender diversity had significant effects on financial performance (ROA) of commercial banks in Nigeria, the audit committee has no significant effects on financial performance (ROA) of commercial banks in Nigeria, and board independence had significant effects on financial performance (ROA) of commercial banks in Nigeria. The study, therefore, concludes that the weak corporate governance structure in Nigeria contributed immensely to the recent crisis experienced in the Nigerian banking sector. The study recommended that banks develop and implement strategic training for board members and senior bank managers. Nigerian banks should appropriately adopt the international codes of corporate governance to meet the need of the Nigerian environment, among other recommendations.

scholarly journals THE STRATEGIC ROLE PLAYED BY CORPORATE GOVERNANCE MECHANISMS IN ENHANCING SUSTAINABLE CORPORATE PERFOMANCE: A SURVEY OF COMMERCIAL BANKS IN KENYA

2017 ◽  
Vol 1 (2) ◽  
pp. 24
Author(s):  
Stephen Kariuki ◽  
Kefah Njenga ◽  
Dan Irungu
Keyword(s):  
Corporate Governance ◽  
Commercial Banks ◽  
Banking Sector ◽  
General Purpose ◽  
Commercial Banking ◽  
Independent Directors ◽  
Governance Mechanisms ◽  
Sustainable Performance ◽  
Corporate Governance Mechanisms ◽  
Strategic Role

Purpose: The general purpose of study was to establish the strategic role that corporate governance mechanisms play in the sustainable corporate performance of commercial banking sector in Kenya.Methodology: The study adopted a descriptive research design. The actual population was also the targeted population was 43 banks since the banks were all accessible. A total of 17 banks were used as an actual sample representing 37% of the total population. The researcher in this study used questionnaire as a data collection tool. The data collected was analyzed by use of both inferential and descriptive statistics.Results: Study findings indicated that, there was an insignificant relationship between percentage mean of independent directors, top 10 shareholding and ROA. In addition there was an insignificant relationship between board size, percentage mean of independent directors, top 10 shareholding and individual shareholding, and Customer satisfaction index.Unique contribution to theory, practice and policy: The study recommends that, commercial banks in Kenya should continue adhering to corporate governance requirements since it may have positively contributed to sustainable performance.

scholarly journals Corporate Governance in the Banking Industry of Kosovo

2019 ◽  
Vol 7 (3) ◽  
pp. 20-34 ◽  
Author(s):  
Arber Hoti ◽  
Arben Dermaku
Keyword(s):  
Corporate Governance ◽  
Regression Analysis ◽  
Financial Performance ◽  
Multiple Regression Analysis ◽  
Board Of Directors ◽  
Multiple Regression ◽  
Commercial Banks ◽  
Banking Sector ◽  
Board Members ◽  
The Board Of Directors

The main purpose of this research is to study the impact of corporate governance on the financial performance of the banking sector in Kosovo. To analyze this impact, the Pearson correlation coefficient, multiple regression analysis related to the board size and board independence and banking sector performance in Kosovo were applied. The key corporate governance variables that have been studied in this research are: (i) size of the board of directors, (ii) the independence of the board of directors (the ratio between non-executive directors and the total number of board members). The data for this research were collected from the annual reports and audited financial statements of commercial banks in Kosovo for the 12 year period (2006-2017) and from questionnaires addressed to board members of commercial banks in Kosovo as well as other publications from relevant local institutions such as the Central Bank of Kosovo (CBK), Statistical Office of Kosovo (SOK), Tax Administration of Kosovo (TAK), etc. The results of the multiple regression analysis regarding the influence of the board of directors on the financial performance of the banking sector indicate that: the size of the board of directors and the independence of the board of directors have a positive and significant impact on the financial performance of the banking sector in Kosovo, expressed through return on assets (ROA) and return on equity (ROE). Findings of this research are in line with the findings of other researchers in this field and confirm the assertion that the management of the above variables improves and has a positive impact on the financial performance of banks in Kosovo.

scholarly journals Corporate Governance and Bank Competition Empirical Study on the Jordanian Commercial Banks Listed in Amman Stock Exchange over the Period (2001-2014)

2015 ◽  
Vol 7 (2) ◽  
pp. 227
Author(s):  
Abdulrahman Hashem ◽  
Fadi Mousa Ayoub ◽  
Haitham Bani Ata
Keyword(s):  
Corporate Governance ◽  
Empirical Study ◽  
Commercial Banks ◽  
Banking Sector ◽  
Stock Exchange ◽  
The Political ◽  
Bank Competition ◽  
Whitney Test ◽  
Insignificant Effect ◽  
Amman Stock Exchange

<p>The purpose of this paper is to identify the effect of corporate governance implementation on the commercial banks’ competition in Jordan. Bank competition is tested by using Panzar and Rosse H statistics model and the researchers applied it on the collected data into two periods of time (2001-2007 and 2008-2014), taking into consideration that corporate governance was first implemented in the Jordanian banking sector on 31/12/2007. The researchers used Mann-Whitney Test to compare the results of both time phases. The results showed insignificant effect of corporate governance on bank competition that can be linked to certain reasons including the immaturity of corporate governance’s implementation in the Jordanian banking sector, the socio political upheavals that affected Jordan, and the differentiation of bank services between banks led to a more monopolistic behavior. This paper urges other researchers and practitioners to take their role into updating and modifying corporate governance to positively enhance bank competition taking into account the political turbulences in the neighboring countries and the movement of cash across the region and passing the country. </p>

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