Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan

Uzma Bashir; Ummara Fatima; Sundas Sohail; Farhat Rasul; Rabia Mehboob

doi:doi:10.11648/j.jfa.20180601.12

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Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan

Uzma Bashir, Ummara Fatima, Sundas Sohail, Farhat Rasul, Rabia Mehboob

Published in Journal of Finance and Accounting (Volume 6, Issue 1)

Received: 29 August 2017 Accepted: 5 December 2017 Published: 20 January 2018

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Abstract

The persistence of corporate governance (CG) is to expedite operative and cautious management which can transport the enduring success of the company. The performance of any firm or bank is vibrantly enhanced by corporate governance. The key contribution of this study to governance literature is that; it demonstrates how the presence of the internal governance mechanism influence the bank performance. The study makes an attempt to measure the impact of internal governance indicators (Board Structure and Ownership Structure) on the financial performance (Return on Equity, Return on Assets and Earning Per Share) of the banks of Pakistan under the presence of control variables (leverage and size). The selected sample consist of 30 banks (public, private and specialized), which are listed at Pakistan Stock Exchange (PSE) for the period 2008-2014. The study takes 30 banks listed in PSE, formerly KSE and, check how corporate governance impact on all the listed banks at PSE, irrespective of their nature of operation. Study also extended the time frame till 2014. The study comprises of three models. The regression analysis results reveal that the majority of the internal governance indicators of Model 2 and 3 show significant relationship with ROE and EPS whereas, majority of the internal governance indicators of Model 1 depict insignificant relationship with ROA. The results depict that in a developing country like Pakistan there are sound codes of corporate governance but, their proper implementation is missing.

Published in	Journal of Finance and Accounting (Volume 6, Issue 1)
DOI	10.11648/j.jfa.20180601.12
Page(s)	11-17
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2018. Published by Science Publishing Group

Keywords

Corporate Governance, Board Structure, Ownership Structure, Financial Performance, PSE

References

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APA Style

Uzma Bashir, Ummara Fatima, Sundas Sohail, Farhat Rasul, Rabia Mehboob. (2018). Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan. Journal of Finance and Accounting, 6(1), 11-17. https://doi.org/10.11648/j.jfa.20180601.12

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ACS Style

Uzma Bashir; Ummara Fatima; Sundas Sohail; Farhat Rasul; Rabia Mehboob. Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan. J. Finance Account. 2018, 6(1), 11-17. doi: 10.11648/j.jfa.20180601.12

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AMA Style

Uzma Bashir, Ummara Fatima, Sundas Sohail, Farhat Rasul, Rabia Mehboob. Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan. J Finance Account. 2018;6(1):11-17. doi: 10.11648/j.jfa.20180601.12

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@article{10.11648/j.jfa.20180601.12,
  author = {Uzma Bashir and Ummara Fatima and Sundas Sohail and Farhat Rasul and Rabia Mehboob},
  title = {Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan},
  journal = {Journal of Finance and Accounting},
  volume = {6},
  number = {1},
  pages = {11-17},
  doi = {10.11648/j.jfa.20180601.12},
  url = {https://doi.org/10.11648/j.jfa.20180601.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20180601.12},
  abstract = {The persistence of corporate governance (CG) is to expedite operative and cautious management which can transport the enduring success of the company. The performance of any firm or bank is vibrantly enhanced by corporate governance. The key contribution of this study to governance literature is that; it demonstrates how the presence of the internal governance mechanism influence the bank performance. The study makes an attempt to measure the impact of internal governance indicators (Board Structure and Ownership Structure) on the financial performance (Return on Equity, Return on Assets and Earning Per Share) of the banks of Pakistan under the presence of control variables (leverage and size). The selected sample consist of 30 banks (public, private and specialized), which are listed at Pakistan Stock Exchange (PSE) for the period 2008-2014. The study takes 30 banks listed in PSE, formerly KSE and, check how corporate governance impact on all the listed banks at PSE, irrespective of their nature of operation. Study also extended the time frame till 2014. The study comprises of three models. The regression analysis results reveal that the majority of the internal governance indicators of Model 2 and 3 show significant relationship with ROE and EPS whereas, majority of the internal governance indicators of Model 1 depict insignificant relationship with ROA. The results depict that in a developing country like Pakistan there are sound codes of corporate governance but, their proper implementation is missing.},
 year = {2018}
}

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TY  - JOUR
T1  - Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan
AU  - Uzma Bashir
AU  - Ummara Fatima
AU  - Sundas Sohail
AU  - Farhat Rasul
AU  - Rabia Mehboob
Y1  - 2018/01/20
PY  - 2018
N1  - https://doi.org/10.11648/j.jfa.20180601.12
DO  - 10.11648/j.jfa.20180601.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 11
EP  - 17
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20180601.12
AB  - The persistence of corporate governance (CG) is to expedite operative and cautious management which can transport the enduring success of the company. The performance of any firm or bank is vibrantly enhanced by corporate governance. The key contribution of this study to governance literature is that; it demonstrates how the presence of the internal governance mechanism influence the bank performance. The study makes an attempt to measure the impact of internal governance indicators (Board Structure and Ownership Structure) on the financial performance (Return on Equity, Return on Assets and Earning Per Share) of the banks of Pakistan under the presence of control variables (leverage and size). The selected sample consist of 30 banks (public, private and specialized), which are listed at Pakistan Stock Exchange (PSE) for the period 2008-2014. The study takes 30 banks listed in PSE, formerly KSE and, check how corporate governance impact on all the listed banks at PSE, irrespective of their nature of operation. Study also extended the time frame till 2014. The study comprises of three models. The regression analysis results reveal that the majority of the internal governance indicators of Model 2 and 3 show significant relationship with ROE and EPS whereas, majority of the internal governance indicators of Model 1 depict insignificant relationship with ROA. The results depict that in a developing country like Pakistan there are sound codes of corporate governance but, their proper implementation is missing.
VL  - 6
IS  - 1
ER  -

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Author Information

Uzma Bashir

School of Commerce & Accountancy, Minhaj University, Lahore, Pakistan
Ummara Fatima

School of Commerce & Accountancy, Minhaj University, Lahore, Pakistan
Sundas Sohail

School of Commerce & Accountancy, Minhaj University, Lahore, Pakistan
Farhat Rasul

Pakistan Institute of Development Economics, Islamabad, Pakistan
Rabia Mehboob

School of Commerce & Accountancy, Minhaj University, Lahore, Pakistan

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APA Style

Uzma Bashir, Ummara Fatima, Sundas Sohail, Farhat Rasul, Rabia Mehboob. (2018). Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan. Journal of Finance and Accounting, 6(1), 11-17. https://doi.org/10.11648/j.jfa.20180601.12

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ACS Style

Uzma Bashir; Ummara Fatima; Sundas Sohail; Farhat Rasul; Rabia Mehboob. Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan. J. Finance Account. 2018, 6(1), 11-17. doi: 10.11648/j.jfa.20180601.12

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AMA Style

Uzma Bashir, Ummara Fatima, Sundas Sohail, Farhat Rasul, Rabia Mehboob. Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan. J Finance Account. 2018;6(1):11-17. doi: 10.11648/j.jfa.20180601.12

Copy | Download

@article{10.11648/j.jfa.20180601.12,
  author = {Uzma Bashir and Ummara Fatima and Sundas Sohail and Farhat Rasul and Rabia Mehboob},
  title = {Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan},
  journal = {Journal of Finance and Accounting},
  volume = {6},
  number = {1},
  pages = {11-17},
  doi = {10.11648/j.jfa.20180601.12},
  url = {https://doi.org/10.11648/j.jfa.20180601.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20180601.12},
  abstract = {The persistence of corporate governance (CG) is to expedite operative and cautious management which can transport the enduring success of the company. The performance of any firm or bank is vibrantly enhanced by corporate governance. The key contribution of this study to governance literature is that; it demonstrates how the presence of the internal governance mechanism influence the bank performance. The study makes an attempt to measure the impact of internal governance indicators (Board Structure and Ownership Structure) on the financial performance (Return on Equity, Return on Assets and Earning Per Share) of the banks of Pakistan under the presence of control variables (leverage and size). The selected sample consist of 30 banks (public, private and specialized), which are listed at Pakistan Stock Exchange (PSE) for the period 2008-2014. The study takes 30 banks listed in PSE, formerly KSE and, check how corporate governance impact on all the listed banks at PSE, irrespective of their nature of operation. Study also extended the time frame till 2014. The study comprises of three models. The regression analysis results reveal that the majority of the internal governance indicators of Model 2 and 3 show significant relationship with ROE and EPS whereas, majority of the internal governance indicators of Model 1 depict insignificant relationship with ROA. The results depict that in a developing country like Pakistan there are sound codes of corporate governance but, their proper implementation is missing.},
 year = {2018}
}

Copy | Download

TY  - JOUR
T1  - Internal Corporate Governance and Financial Performance Nexus; a Case of Banks of Pakistan
AU  - Uzma Bashir
AU  - Ummara Fatima
AU  - Sundas Sohail
AU  - Farhat Rasul
AU  - Rabia Mehboob
Y1  - 2018/01/20
PY  - 2018
N1  - https://doi.org/10.11648/j.jfa.20180601.12
DO  - 10.11648/j.jfa.20180601.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 11
EP  - 17
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20180601.12
AB  - The persistence of corporate governance (CG) is to expedite operative and cautious management which can transport the enduring success of the company. The performance of any firm or bank is vibrantly enhanced by corporate governance. The key contribution of this study to governance literature is that; it demonstrates how the presence of the internal governance mechanism influence the bank performance. The study makes an attempt to measure the impact of internal governance indicators (Board Structure and Ownership Structure) on the financial performance (Return on Equity, Return on Assets and Earning Per Share) of the banks of Pakistan under the presence of control variables (leverage and size). The selected sample consist of 30 banks (public, private and specialized), which are listed at Pakistan Stock Exchange (PSE) for the period 2008-2014. The study takes 30 banks listed in PSE, formerly KSE and, check how corporate governance impact on all the listed banks at PSE, irrespective of their nature of operation. Study also extended the time frame till 2014. The study comprises of three models. The regression analysis results reveal that the majority of the internal governance indicators of Model 2 and 3 show significant relationship with ROE and EPS whereas, majority of the internal governance indicators of Model 1 depict insignificant relationship with ROA. The results depict that in a developing country like Pakistan there are sound codes of corporate governance but, their proper implementation is missing.
VL  - 6
IS  - 1
ER  -

Copy | Download