Corporate governance in banks: impact of board attributes on banks performance

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Date

2020

Journal Title

Journal ISSN

Volume Title

Publisher

African J. Accounting, Auditing and Finance

Abstract

The study examines the impact of the board of directors’ composition on firm performance in the Ghanaian banking industry. Using the GMM, fixed and random effect econometric models, the presence of independent non-executive directors (INEDs) on boards are found to significantly and positively contribute to higher bank performance in terms of return on assets. Board size is also found to have significantly influenced banks' performance positively concerning both return on assets and return on equity, but negatively affects the net profit margins of banks. The study further establishes that board members political attachment has a profound adverse influence on firm performance particularly on net interest margin. These findings provide further insights into the impact of board attributes on firm performance in the banking industry, especially in a developing and under-researched context. Research and practical implications are discussed.

Description

Research Article

Keywords

corporate governance, board composition, independent directors, firm performance, Ghana

Citation

Nyuur, R.B., Ofori, D.F. and Dedzo, B.Q. (2020) ‘Corporate governance in banks: impact of board attributes on banks performance’, African J. Accounting, Auditing and Finance, Vol. 7, No. 1, pp.24–41.