Abstract:
Purpose – This paper aims to examine the impact of diversity of board members’ educational
qualifications on the financial performance of banks in Ghana.
Design/methodology/approach – The present study applies system generalized methods of moments
as an econometric model in carrying out the analysis. The study yielded a usable sample of 28 banks
spanning from2001 to 2016.
Findings – The paper concludes that the Ghanaian banking sector profit diverges and invalidates the
convergence theory or ‘‘catch-up effect’’. Specifically, educational qualifications of board members are
relevant to banks’ financial performance. Across all the models used, board members with a first degree
have a significant positive impact on performance. The opposite is the case for board members with
Doctor of Philosophy (PhD).
Research limitations/implications – Unobservable characteristics such as entrepreneurial skills and
intellectual competence experiences are excluded from the study because of the difficulties in measuring
these variables. Notwithstanding, the exclusion of these characteristics does not invalidate the general
outcome of the study.
Originality/value – The present study examines the impact of diversity of board members’ educational
qualification on financial performance in the context of Sub-Saharan Africa, particularly Ghana. It also
extends the existing literature by decomposing the banking sector into listed, non-listed, foreign and
domestic banks.