scholarly journals Impact of Product Mix and Corporate Governance Practices on Earnings Volatility-Evidence from Banking Sector of Pakistan

2016 ◽  
Vol 3 (2) ◽  
pp. 1
Author(s):  
Natasha Yaqub ◽  
Huma Ayub
Keyword(s):  
Corporate Governance ◽  
Banking Sector ◽  
Contributing Factors ◽  
Board Size ◽  
Product Mix ◽  
Earnings Volatility ◽  
Governance Practices ◽  
Revenue Volatility ◽  
The Relationship

The study examines the relationship between product mix and corporate governance on earnings volatility with the help of degree of total leverage (DTL) model. The present study attempts to fill the gap by investigating the relationship between product mix and corporate governance on earnings volatility for developing financial market during the period of 2005-2015. Earnings volatility is analysed by two proxies’ .i.e. revenue volatility and degree of total leverage. This study has used mainly two types of product mix that consists of lending and fee-based activities while board size, board independence and CEO power is used to measure corporate governance. The results of the study signify the adverse impact of fee-based activities on earnings volatility in the banking sector of Pakistan. Corporate governance confirms the board size and power of CEO in the board as contributing factors to control earnings volatility. The findings are useful to the bankers and regulators to comprehend the role of diversification and corporate governance in creating value and reducing risk for the stakeholders.

scholarly journals Role Of Board Size In Corporate Governance And Firm Performance Applying Pareto Approach, Is It Cultural Phenomena?

2014 ◽  
Vol 30 (5) ◽  
pp. 1395 ◽  
Author(s):  
Maria Malik ◽  
Difang Wan ◽  
Muhammad Ishfaq Ahmad ◽  
Muhammad Akram Naseem ◽  
Ramiz Ur Rehman
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Positive Relationship ◽  
Banking Sector ◽  
Bank Performance ◽  
Board Size ◽  
Performance Variables ◽  
Governance Practices ◽  
The Relationship

<p>This paper examines the relationship between board size and firm performance. This relationship is tested in the light of Pareto Approach for Pakistani banking sector. For this purpose a sample of fourteen listed commercial banks of Pakistan are taken for analysis from 2008-2012 on the basis of their performance. Different econometric models are applied to test the relationship between bank performance variables and corporate governance practices in these banks. The results of this study are contradictory with the existing literature of corporate governance variables and firm performance. The most prominent result of this paper is the significant positive relationship between board size and bank performance. It is concluded in the findings that a large board size can enhance the bank performance in Pakistani scenario.</p>

scholarly journals The impact of Board Size on the Performance of Shariah-Compliant Companies in Malaysia

2019 ◽  
Vol 8 (4) ◽  
pp. 6709-6711
Keyword(s):  
Corporate Governance ◽  
Consumer Products ◽  
Strong Positive Correlation ◽  
Board Size ◽  
Daily Lives ◽  
Governance Practices ◽  
And Performance ◽  
Code Of Corporate Governance ◽  
The Impact ◽  
The Relationship

The objective of this study is to examine the relationship between the board size and firm performance of Shariah-Compliant companies in Malaysia. The characteristics of the board of Shariah-compliant companies in Consumer Products counter of Bursa Malaysia are being examined against the firm’s performance using data from 77 companies from year 2014 to 2016. Based on the result of regression, board size has a strong positive correlation with the performance of the firms. This study suggests that Shariah-Compliant Companies need to strengthen the Shariah governance to produce products that Muslim consumer use in their daily lives. The appointment of director with Shariah background must be highly encouraged if not mandatory to companies involved in producing food, drinks, pharmaceutical and cosmetics in order for the companies to tap their expertise in enhancing halal governance. The findings of the study would be very useful to the regulators to improve the Malaysian Code of Corporate Governance. Furthermore, the findings of the study also help to fill the gap on scarce of literatures that study the relationship between the corporate governance practices and performance.

The Relationship Between Corporate Governance and Corporate Social Responsibility Expenditure in Bangladesh: Moderating Role of Firm Value

2020 ◽  
Vol 13 (2) ◽  
pp. 190-209
Author(s):  
Md Sajjad Hosain
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Firm Value ◽  
Banking Sector ◽  
Gender Diversity ◽  
Annual Reports ◽  
Corporate Social ◽  
The Relationship

This article aims at identifying the relationship between corporate governance (CG) and corporate social responsibility expenditure (CSRE) for the Bangladeshi banking sector. CG has been considered as the single independent variable divided into three components: board size (BS), gender diversity (GD) and board members’ interrelationship (BMI), and CSRE has been considered as the dependent variable. Further, a single moderator—firm value (FV) as been employed in order to test the moderating influence. Annual reports from 2015 to 2019 (5 years) of 35 banking firms have been used as samples. The study utilized Pearson’s correlation coefficient in order to test the direct relationships and regression analysis to test the moderating effects. The analysis has revealed that BS and GD are positively associated with CSRE while BMI has a negative association with CSRE. Furthermore, has been revealed that FV can moderate all the direct relationships. The study is expected to aid researchers in further empirical investigation over this important issue and guide policymakers to obtain more representative outcomes to make constructive decisions regarding CG and CSRE that would, in turn, increase FV.

Is online disclosure the key to corporate governance?

2019 ◽  
Vol 43 (5) ◽  
pp. 893-921 ◽  
Author(s):  
Francisco J. López-Arceiz ◽  
Lourdes Torres ◽  
Ana J. Bellostas Ana J. Bellostas
Keyword(s):  
Corporate Governance ◽  
Structural Equation ◽  
Structural Equation Models ◽  
Content Type ◽  
Web 3.0 ◽  
Financial Position ◽  
Disclosure Of Information ◽  
Governance Practices ◽  
The Relationship

Purpose The economic literature shows contradictory results when the relationship between corporate governance and financial position is assessed. The purpose of this paper is to analyze the role of the online disclosure of information, as an omitted variable, in this relationship. Design/methodology/approach In order to test the role of the online disclosure of information, a set of the structural equation models is evaluated. In these models, the indirect effect of the online disclosure on the relationship between corporate governance and the financial position, defined by performance, funding and investment, is analyzed. Findings Using data from a sample of 252 Spanish public non-profits between 2012 and 2016, the authors found that the development of corporate governance practices is not, by itself, able to improve the financial position of these organizations. These improvements can only be achieved if the online disclosure is promoted. Research limitations/implications Organizations should not only follow corporate governance practices but also communicate to the stakeholders the degree of development of these practices in an exercise of accountability. Finally, Web 3.0 practices must be promoted because they can be a mechanism to reinforce corporate governance practices and achieve a solid financial position. Originality/value This study contributes to the debate about the role of the online disclosure, introducing this transparent practice as a variable omitted by previous research. Moreover, the authors have considered the evolution for a period of four years in relation to the information published by each organization on the internet.

scholarly journals Impact of Board Structure on Insolvency and Credit Risk: Moderating role of Domestic and Transnational Financial Liberalization in Asian Banking Sector

2019 ◽  
pp. 99-116
Author(s):  
Rashida Bibi ◽  
Zaheer Abbas ◽  
Waqas Ahmad ◽  
Tahira Awan
Keyword(s):  
Risk Taking ◽  
Banking Sector ◽  
Financial Liberalization ◽  
Annual Reports ◽  
Board Independence ◽  
Board Structure ◽  
Board Size ◽  
The Relationship ◽  
Moderating Role

Purpose-The aim of this study is to analyze the effect of board structure on risk-taking. It also takes financial liberalization as a moderator between board structure and risk-taking. Design/methodology/approach- Data of variables of interest has been obtained from the annual reports of banks and statistical reports published by Central Bank of concerned countries. Ten banks have been selected from every ten Asian countries during the period 2005 to 2015. GMM estimator is used for data analysis. Findings- Findings of the study reveal that both board size and board independence decrease risk-taking practices in sample economies. Further, the presence of powerful CEOs on board structure increases risk-taking. The most robust result has been proved for board independence as compared with board size and CEO/chairman duality. Financial liberalization moderates the relationship between board structure and risk-taking. Originality/value- Most of the previously published studies in this area use only one type of financial liberalization at one time. This study includes both types of financial liberalization: domestic financial liberalization and transnational financial liberalization, at one time. Laeven financial liberalization index has been created for concerned economies.

Corporate Governance and Performance of Shariah-Compliant Companies

2020 ◽  
pp. 547-566
Author(s):  
Mustafa Bin Mohd Hanefah ◽  
Muhammad Iqmal Hisham Kamaruddin ◽  
Rosnia Masruki ◽  
Mohd Marzuki Ismail
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Negative Correlation ◽  
Consumer Products ◽  
Board Size ◽  
Governance Practices ◽  
And Performance ◽  
Using Data ◽  
Code Of Corporate Governance ◽  
The Relationship

This chapter examines the relationship between corporate governance practices and firm performance. The characteristics of the board of Shari'ah-compliant companies in consumer products counter of Bursa Malaysia were examined against the firm's performance using data from 77 companies from 2014 to 2016. Based on the result of multiple regression; board size, Muslim chairman, and Muslim director have a weak positive correlation with the performance of the firms. However, directors with Shari'ah background seem to have a negative correlation with the performance of the firms. The findings of the chapter would be very useful to the regulators to improve the Malaysian Code of Corporate Governance (MCCG). The findings also help to fill the gap on scarce literature that study the relationship between the corporate governance practices involving Muslim characteristics and performance.

Effects of Innovation Investment on Profitability and Moderating Role of Corporate Governance: Empirical Study of Indian Listed Firms

2017 ◽  
Vol 10 (2) ◽  
pp. 97-117 ◽  
Author(s):  
Showkat Ahmad Busru ◽  
G. Shanmugasundaram
Keyword(s):  
Corporate Governance ◽  
Corporate Culture ◽  
Multiple Regression Model ◽  
Family Ownership ◽  
Board Size ◽  
Causality Test ◽  
Listed Firms ◽  
The Relationship ◽  
Moderating Role

Innovation investment decisions are always riskier business decisions, especially when it is a question of spending on research and development, but it is a vital area of decision-making which enhances growth and sustainability. First, we attempted to investigate the bidirectional causality between R&D and profitability measured in terms of NP (net profit), ROA and ROE through Granger causality test from a sample of 255 sample Indian listed firms for a period of eight years ranging from 2008 to 2015, while finding unidirectional causality only between R&D expenditure and profitability, we moved for analysing the magnitude of relationship through multiple regression model which revealed that R&D expenditure negatively affects the profitability but affects the profitability of subsequent years positively while taking lags. Further, moderating regressions equation was employed to assess the moderating role of corporate governance variables such as board size, board independence, family ownership, foreign and institutional ownership with controlling effects of size, market capital and liquidity position. The results revealed that all moderating variables except board size affect the slope of regression positively, but technically only family ownership moderates the relationship between R&D expenditure and profitability as there is significant change in f-value while moderation effect of family ownership is taken into consideration. Only board size affects negatively the relationship questioning the role of internal board and their interest in innovation for maximising personal benefits on the expense of risk-bearing shareholders and stakeholders. Our results were in conformity with some prior studies but have also shown contradiction with results of developed estates regarding role of board for balancing the agency theory conflicts, hence creating room for Indian corporate culture with a full-fledged system which can strike a balance between interest of agents and principals with protection to minority shareholders and overall stakeholders.

DHFL Meltdown: The Corporate Governance Lapses

2021 ◽  
pp. 097282012199882
Author(s):  
Daitri Tiwary ◽  
Arunaditya Sahay
Keyword(s):  
Corporate Governance ◽  
Banking Sector ◽  
Housing Finance ◽  
Shadow Banking ◽  
Share Prices ◽  
A Value ◽  
Governance Practices ◽  
The Board Of Directors ◽  
Company Sector ◽  
Financial Company

India’s non-banking financial institutions (NBFIs), broadly constituting the less-regulated shadow banking sector, have been plagued with scams, triggering a domino effect in the Indian money market. Major corporate governance issues were highlighted in NBFIs with the unfurling of the ILF&S fraud; it virtually created a sub-prime crisis. In such a scenario, where the shadow banking sector was subject to change in regulations to ensure vigilance, corporate governance lapses had again led to the meltdown of Kapil Wadhawan led Dewan Housing Finance Limited (DHFL). Registering a net profit growth of 25% in the third quarter of financial year 2017, DHFL was one of India’s leading housing finance companies with a value of whopping ₹1.01 trillion as its asset under management (AUM). The company had nose-dived from its coveted position, suffering a loss of ₹22.23 million for the last quarter of the financial year 2018–2019. The company’s credit ratings of commercial papers and non-convertible debentures were downgraded; non-payment of interests led to enforcement of resolution plan, with the board of directors acceding to nationalized banks. The company’s reputation had crashed with its share prices, amidst allegations of lookout notice issued for its promoters for siphoning funds through shell companies. The case describes the oversights and negligence of DHFL in terms of corporate governance practices in the context of the NBFC (non-banking financial company) sector. The jury is out to evaluate whether Wadhawan had followed the rules of corporate governance in letter and spirit, or the tightening noose of regulations and market sentiments around the ‘shadow banking’ sector of India spelt doom for DHFL.

Managing different forms of distances in Dutch healthcare organizations

2015 ◽  
Vol 29 (7) ◽  
pp. 1080-1097
Author(s):  
Annemiek Stoopendaal
Keyword(s):  
Design Methodology ◽  
Healthcare Organization ◽  
Ethnographic Study ◽  
Healthcare Organizations ◽  
Content Type ◽  
Daily Work ◽  
Healthcare Executives ◽  
Governance Practices ◽  
The Relationship

Purpose – Dichotomous “gap” thinking about professionals and managers has important limits. The purpose of this paper is to study the specific ontology of “the gap” in which different forms of distances are defined. Design/methodology/approach – In order to deepen the knowledge of the actual day-to-day tasks of Dutch healthcare executives an ethnographic study of the daily work of Dutch healthcare executives and an ontological exploration of the concept “gap” was provided. The study empirically investigates the meaning given to the concept of “distance” in healthcare governance practices. Findings – The study reveals that healthcare executives have to fulfil a dual role of maintaining distance and creating proximity. Coping with different forms of distances seems to be an integral part of their work. They make use of four potential mechanisms to cope with distance in their healthcare organization practices. Originality/value – The relationship between managers and professionals is often defined as a dichotomous gap. The findings in this research suggest a more dynamic picture of the relationship between managers and professionals than is currently present in literature. This study moves “beyond” the gap and investigates processes of distancing in-depth.

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