Directors’ remuneration, governance and performance: the case of Malaysian banks

Lee, Siew Peng; Isa, Mansor

doi:10.1108/mf-08-2013-0222

Cited by 39 publications

(44 citation statements)

References 58 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…After regressing the control variables, the positive impact of DCOMP held. This is consistent with the findings of Peng and Mansor (2015), Doucouliagos et al (2007), Brian et al (1996), Jaafar et al (2011), and Ghosh (2006), as well as the agency theory (Fama 1980). Our study further suggests that the compensation paid to directors in Pakistan is consistent with past bank performance; therefore, it has a positive impact on profitability 12 .…”

Section: Board Findingssupporting

confidence: 92%

“…We found a significant positive impact of lagged bank profitability, when measured by ROA, ROE, and PM, on director compensation and an insignificant positive impact of lagged director compensation on profitability, indicating that, in Pakistan, director compensation is explained by past bank performance. Our findings contradictBugeja et al (2016) andPeng and Mansor (2015), who both found an inconsistent relationship between past performance and director compensation. The results of the Granger causality are not reported, but are available upon request.…”

contrasting

confidence: 99%

“…Ghosh (2006) also extended a positive relationship between CEO compensation and firm performance. In addition, many studies related to the financial sector also reported a positive association between director compensation and performance (Ang et al 2002;Becher et al 2005;Chang et al 2015;Doucouliagos et al 2007;Houston and James 1995;John and Qian 2003;Peng and Mansor 2015). In light of the above findings, we postulate our seventh hypothesis.…”

Section: Hypothesis 2 (H2)mentioning

confidence: 53%

“…To determine the consistency of the relationship between director compensation and past bank performance, we followedPeng and Mansor (2015) and applied the Granger causality test. We found a significant positive impact of lagged bank profitability, when measured by ROA, ROE, and PM, on director compensation and an insignificant positive impact of lagged director compensation on profitability, indicating that, in Pakistan, director compensation is explained by past bank performance.…”

mentioning

confidence: 99%

See 3 more Smart Citations

Corporate Governance, Political Connections, and Bank Performance

Haris

Yao

Tariq

et al. 2019

IJFS

View full text Add to dashboard Cite

This study investigates the impact of corporate governance characteristics and political connections of directors on the profitability of banks in Pakistan. The study uses the data of 26 domestic banks over the latest and large period of 2007–2016. Our findings firstly affirm that bank profitability is negatively affected by the presence of politically connected directors on the board, reporting significantly lower return on assets, return on equity, net interest margin, and profit margin. Secondly, our findings also affirm the negative political influence on the sustainability of the banking industry, reporting significantly lower return on assets, return on equity, net interest margin, and profit margin during the government transition of banks having politically connected directors sitting on their board. Our findings further report an inverted U-shaped relationship between board size and bank profitability, suggesting that a board size beyond 8–9 members decreases the profitability. The study further finds a positive impact of board composition, board independence, and director compensation on bank profitability, while also finding a negative impact of frequent board meetings, presence of foreign directors, and audit committee independence.

show abstract

Section: Board Findingssupporting

confidence: 92%

contrasting

confidence: 99%

Section: Hypothesis 2 (H2)mentioning

confidence: 53%

mentioning

confidence: 99%

See 2 more Smart Citations

Corporate Governance, Political Connections, and Bank Performance

Haris

Yao

Tariq

et al. 2019

IJFS

View full text Add to dashboard Cite

show abstract

“…Directors' remuneration is one of the motivation mechanisms for the directors in order to help their company achieve, maintain and driven board motivation to improve firm value. Several studies found that higher remuneration paid to the board of directors leading to higher financial performance (Lee & Isa, 2015). On the other hand, other studies found a negative relationship between board remuneration and firm performance (Hassan & Theo, 2003).…”

Section: Independent Variablesmentioning

confidence: 93%

Woman On Board And Firm Performance: Evidence From Industrial Companies

Hamid¹

2018

The European Proceedings of Social and Behavioural Sciences

View full text Add to dashboard Cite

This study aims to examine the effect of board gender diversity on the firm performance. This study also includes controlling variable effect to examine the relationship between gender diversity and firm performance. The ordinary least squares (OLS) regression analysis is used to investigate the relationship between gender diversity of board of directors and firm performance. This study tests the hypotheses on a sample of listed industrial companies on the Bursa Malaysia for the year 2016. The results indicate that the boards of sample companies in Malaysia are male-dominated. Moreover, this study finds that the board gender diversity did not have significant impacts on firm performance, as measured by return on assets (ROA) and return on equity (ROE). Limited empirical evidences and studies have been conducted on the relationship between board gender diversity and firm performance in emerging countries. In addition, lack of consensus on the relationship between board gender diversity and firm performance and it was based on mixed and contradictory findings in prior research. Therefore, this study extent the current literature in the context of Malaysia indicates that female directors cannot play their roles actively and effectively due to a very limited number of female representatives on the boardroom. This study contributes advanced empirical evidence on board gender diversity and board characteristics on the firm performance relationship in the context of Malaysia.

show abstract

Political connections and remuneration of bank boards’ members: moderating effect of gender diversity

2022

View full text Add to dashboard Cite

This study investigates the effect of the political connections of members of banks' Boards of Directors on the remuneration of these boards, taking into account the gender diversity of their members. Using a panel of observations on 77 banks supervised by the ECB for the period 2013 to 2017, and the generalized method of moments (GMM), our results show that, when analyzing linear effects, political connections have a negative impact on the remuneration of the members of the banks' Boards of Directors, reducing them. However, when investigating the possible moderating effect, we found that when gender diversity is high, there is a non-linear, inverted U-shaped relationship between the political connections and the remuneration of members of the Boards of Directors of banks. Our results also show that the differentiating characteristics of the female gender, accentuate the negative effects of political connections on remuneration, making the institution's interests to be privileged at the expense of those of its personal agendas.Overall, these general results prove to be robust across different choices of the measures used for gender diversity.

show abstract

Directors’ remuneration, governance and performance: the case of Malaysian banks

Cited by 39 publications

References 58 publications

Corporate Governance, Political Connections, and Bank Performance

Corporate Governance, Political Connections, and Bank Performance

Woman On Board And Firm Performance: Evidence From Industrial Companies

Political connections and remuneration of bank boards’ members: moderating effect of gender diversity

Contact Info

Product

Resources

About