- مبلغ: ۸۶,۰۰۰ تومان
- مبلغ: ۹۱,۰۰۰ تومان
Research Question/Issue: The importance of corporate governance reforms for the MENA country banks has been a relatively underresearched area. To address this issue, we combine the staggered timing of corporate governance reforms for banks across MENA countries with bank-level data for the period 2000-2012 and examine the impact on bank performance. Research Findings/ Insights: The analysis suggests that not all governance characteristics are equally effective and some of these characteristics exert a more pronounced effect on bank performance as compared to others. These results also vary across oil exporting and oil importing nations and differs during the crisis. Besides, we find that improved operating efficiency and access to finance are the key channels through which governance improves bank performance. Therefore, the analysis of the effect of governance reforms and implementation on the success of a bank sheds light not only from a financial sector standpoint, but also from a systemic viewpoint. Theoretical/Academic implications: The results show that although corporate governance reforms by themselves are not very effective, the impact on performance is quite pronounced when considered alongside related corporate governance characteristics. The paper shows how a stakeholder from within or from outside can assess the magnitude of the potential governance risks to an individual bank. Practitioner/ Policy implications: Corporate governance reforms in the MENA countries need to be carefully tailored, taking into account the inherent economic characteristics of the country in order for it to exert durable impact. The challenge for policymakers is to find the right balance that can ensure maximum benefits for the banking sector, while minimizing the challenges involved in its implementation.
The literature on corporate governance has spawned in recent times, with a significant volume of research examining varied facets of the process. One area of the global economy wherein this attention has been quite limited is the MENA region. To address this shortcoming, we integrate data on MENA banks with the corporate governance reforms across countries in this region for an extended time span and examine their impact on performance. The results show that although corporate governance reforms by themselves are not very effective, the impact on profitability is quite pronounced when considered alongside several corporate governance characteristics. To be more specific, the binding nature of governance reforms along with board size and disclosure practices are the key variables that affect bank profitability. Further investigations reveal that these results are driven essentially by the oil exporting countries, whereas the results for oil importers indicate that board structure and tenure of board members are the important variables that influence performance. Our results also shed light on the channels through which governance influences bank performance. We show that the improvements in profitability are driven by controlled growth in operating expenses whereas increases in market valuation are the result of improved investor confidence emanating from better access to financing. To sum up, the broad conclusion is that corporate governance reforms need to be carefully tailored, taking into account the inherent economic characteristics of the country in order for it to exert durable impact. The challenge for policymakers is to find the right balance that can ensure maximum benefits for the banking sector, while minimizing the challenges involved in its implementation.