David Adeabah and Charles Andoh
The study examines the relationship between the consequential social cost of market power (i.e. welfare performance of banks) and cost efficiency using data covering the period…
Abstract
Purpose
The study examines the relationship between the consequential social cost of market power (i.e. welfare performance of banks) and cost efficiency using data covering the period 2009 to 2017 from the Ghanaian banking industry.
Design/methodology/approach
The study adopts the ordinary least squares (OLS), fixed effect (FE) panel regression and the quantile regression (QR) approaches to control for heterogeneity and provide increased room for policy relevance. The two-stage least squares instrumental variables (2SLS-IV) regression is used to ensure the robustness of the findings against the problem of possible reverse causality.
Findings
The results indicate a positive relationship between banks' welfare performance and cost efficiency, which suggests that greater cost efficiency hedges welfare losses. In other words, welfare gains and cost-efficient banks are not mutually exclusive. Also, the results show evidence that the sensitivity of welfare gain to cost efficiency depends on the knowledge of local market dynamics. Further, the findings from the QR estimation suggest that, but for welfare loss at low (Q.25) to the median (Q.50) quantiles, cost efficiency is a necessary and sufficient condition to hedge the welfare losses.
Practical implications
The results demonstrate that financial consumer protection cannot be achieved without cost efficiency in the presence of both foreign banks and high market knowledge. Therefore, our paper suggests an integrated cost efficiency policy approach that has the complementary effect of a robust information sharing mechanism and incentives to hedge against welfare losses in the banking sector of emerging economies. Moreover, if welfare gain is synonymous with cost-efficient banks, then the presence of a quiet life is typical of financial consumer protection.
Originality/value
This study provides insight into the importance of cost efficiency to the public policy of financial consumer protection in an era of foreign banks' dominance. From the review of prior literature, this paper is the first to apply the QR estimation technique to examine the effect of cost efficiency throughout the conditional distribution of bank welfare performance rather than just the conditional mean effect of cost efficiency.
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David Adeabah, Agyapomaa Gyeke-Dako and Charles Andoh
This study aims to analyze the efficiency of banks under board gender diversity and to examine the determinants of bank efficiency.
Abstract
Purpose
This study aims to analyze the efficiency of banks under board gender diversity and to examine the determinants of bank efficiency.
Design/methodology/approach
Data for analysis were sourced from annual reports of 21 banks for the period from 2009 to 2017. A two-step framework was used: first, an examination of efficiency scores with and without board gender diversity computed using data envelopment analysis; and second, a regression of board gender diversity as a determinant of bank efficiency using panel estimation on an unbalanced panel data.
Findings
The results reveal that gender diversity promotes bank efficiency up to a maximum of two female directors on a nine-member board of directors, suggesting a threshold effect on bank efficiency. Board size improves bank efficiency. Board independence is negatively related to bank efficiency. Also, powerful chief executive officers are detrimental for bank efficiency. Finally, the authors find that ownership structure, bank size, bank age and loan-to-deposit ratio are important factors affecting bank efficiency.
Research limitations/implications
All bank-year observations with no female representation on the board were excluded. As such, this paper is limited to 21 banks. Future research should look at a larger data set and account for dynamic endogeneity.
Practical implications
The paper contributes to bank governance structure, namely, gender composition of boards, and provides an insight for regulators and shareholders to estimate the role of men and women on boards.
Originality/value
The novel feature of the efficiency model used is that it incorporates board gender diversity as an additional input variable, in line with the preposition of proponent of resource dependency theory.
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Robert Brenya, Isaac Akomea-Frimpong, Deborah Ofosu and David Adeabah
As global concerns for sustainability have gained traction in all sectors of every economy including agribusiness, the need to investigate the critical barriers that could hamper…
Abstract
Purpose
As global concerns for sustainability have gained traction in all sectors of every economy including agribusiness, the need to investigate the critical barriers that could hamper this novelty has also risen. In that regard, this study presents a comprehensive overview of the dominant barriers encountered by agribusinesses to ensure long-term success through the lenses of a literature review.
Design/methodology/approach
The study used a systematic literature review (SLR) of 43 relevant articles. The study applies content analysis to identify and analyze the selected articles. The conceptual framework underlines the three principal barriers to sustainable agribusinesses.
Findings
The results from the SLR demonstrates that inadequate financial support, excessive post-harvest loss, gender inequality, non-climate-smart policies and weak institutional controls constitute the major challenges to the sustainability of agribusinesses.
Research limitations/implications
The study is limited in scope to barriers to the sustainability of agribusiness only not the broad spectrum of the concept of agriculture.
Originality/value
This study's uniqueness is twofold. First, it provides a checklist for practice with the goal of addressing problems that hamper the sustainability of agribusinesses. Second, the findings and research gaps in this study are important to support future studies.
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David Kofi Wuaku, Samuel Koomson, Ernest Mensah Abraham, Ummu Markwei and Joan-Ark Manu Agyapong
In the past few years, researchers across the world have been attracted to corporate governance (CG) and sustainability studies in the banking space. However, inconsistencies…
Abstract
Purpose
In the past few years, researchers across the world have been attracted to corporate governance (CG) and sustainability studies in the banking space. However, inconsistencies remain, which have created a lack of alignment in existing research. To address this problem, this paper aims to re-examines the CG–bank sustainability relationship using a qualitative design, which has been underused in the field, to generate in-depth, useful and novel analysis and insights that may hide behind the numbers.
Design/methodology/approach
A qualitative inquiry was conducted using key informants in Ghana’s banking industry. This study made use of purposive and snowball sampling techniques, an interview guide and the thematic approach to qualitative data analysis.
Findings
Firstly, this research finds that while larger boards do not promote bank sustainability, those who are independent and have diversified expertise and experiences do. Secondly, CEO duality can boost bank sustainability only if the CEO is actively engaged and performing. Thirdly, this study finds that foreign-owned and managed banks make more profits only if they have good knowledge of the local market.
Research limitations/implications
This research makes the call that upcoming researchers should replicate this research in other banking settings worldwide to validate the results.
Practical implications
Practical lessons for local and foreign-owned banks and their shareholders are discussed to advance the United Nations’ Sustainable Development Goal 8.
Originality/value
This research shares novel insights that offer clarity to the literature and move the CG and sustainability fields forward.
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Pamela Leyva-Townsend, Wilson Rodriguez, Sandra Idrovo and Fredy Pulga
This study aims to elucidate the relationship between women's participation on the board of directors and the company's financial performance in a sample of 45 Colombian companies…
Abstract
Purpose
This study aims to elucidate the relationship between women's participation on the board of directors and the company's financial performance in a sample of 45 Colombian companies listed on the Colombia Stock Exchange (CSE) (Bolsa de Valores de Colombia).
Design/methodology/approach
Using 50,214 financial records of 45 companies listed on the CSE during 2008–2016, the authors performed panel data regressions to explore the relationship between the measures of gender diversity on boards and the impact on corporate financial performance.
Findings
The authors show that the participation and presence of at least one woman on the board of directors are positively associated with firm financial performance as measured by return on equity (ROE), but not as measured by Tobin’s Q. This second indicator is positively associated with firm financial performance when there are at least three female directors on boards of 10 or more individuals.
Practical implications
The findings also provide evidence supporting the development of managerial and organizational mechanisms that strengthen female presence at the highest level of governance.
Originality/value
The study demonstrates that female presence on boards has a positive impact on firms’ financial performance, but the degree of diversity impacts differently ROE and Tobin’s Q. These findings are based on a study of an emerging economy in Latin America, and data on similar economies are scarce.
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The study's objectives are to conduct a comprehensive review of existing knowledge, thoroughly understand the present state of green finance, identify emerging research trends…
Abstract
Purpose
The study's objectives are to conduct a comprehensive review of existing knowledge, thoroughly understand the present state of green finance, identify emerging research trends, perform content analysis and offer valuable guidance for advancing this field.
Design/methodology/approach
Data has been collected by selecting highly indexed databases, Scopus and Web of Science. These databases are well-known repositories of academic papers, journals and other scholarly publications related to various fields of study. This research uses the PRISMA methodology for conducting a structured literature review and employs a bibliometric approach to summarize the findings of the previous studies. “R” studio and Biblioshiny are used to clean the data and visualize the results. The TCCM framework is utilized to propose potential avenues for future research in the domain of green finance.
Findings
The research uncovers the potential areas in the domain of green finance for future work, encompassing green bonds, the green economy, connectivity, forces, constraints and sustainable development. Furthermore, this process enhances the theoretical underpinnings of scholarly investigations within the discipline by succinctly synthesizing and evaluating preexisting literature. This contribution could facilitate more informed and focused research endeavors in green finance.
Practical implications
The research findings have practical implications for researchers, practitioners, regulators, legislators, issuers and investors involved in green finance. The results can take initiatives to improve practices related to issuing and pricing green financial products and enhance the understanding of interconnectedness within the field.
Originality/value
This ground-breaking research sheds light on various emerging areas by taking a new approach, including the most widely read articles, authors and journals and the broader conceptual and intellectual framework. That includes finding and expanding original research streams, summarizing the most seminal works, and suggesting new research pathways.
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Izra Berakon, Amin Wibowo, Nurul Indarti, Nor Nabilla Muhammad and Rizaldi Yusfiarto
The purpose of this study is to examine the effect of the efficiency model on firms performance. The authors also strive to test the compatibility of the efficiency models of…
Abstract
Purpose
The purpose of this study is to examine the effect of the efficiency model on firms performance. The authors also strive to test the compatibility of the efficiency models of Sharia and non-Sharia manufacturing firms.
Design/methodology/approach
The samples are manufacturing industry firms listed on the Indonesia Stock Exchange from 2013 to 2021. This study used 68 firms, with details of 34 Sharia while the remaining 34 were non-Sharia. The data were analyzed using generalized least square (GLS) to test the entire formulated hypothesis. Moreover, current research provides robustness tests to gain more valid and reliable results.
Findings
The results demonstrated that cost efficiency (CE), human capital efficiency (HCE) and capital intensity (CI) affect the firm’s performance. The efficiency model is more appropriate to be applied to the manufacturing Sharia firms in Indonesia. The results are robust even though the feasible GLS and panel-corrected standards errors models are added and a split sample is applied based on certain firm characteristics.
Practical implications
This research can bridge the theory and practice that exist in companies. The authors proposed an efficiency model that can maximize firm performance profits. Moreover, it turns out that the efficiency model is more relevant to be applied to Sharia firms in Indonesia. Furthermore, the research findings have several implications notably for theoretical development, global enterprises and practitioners.
Originality/value
This study expands the literature and discussion about the efficiency model by formulating and investigating CE, HCE and CI on the firm performance which previous studies have rarely elaborated on and tested. In addition, the authors divided the sample into two groups (Sharia and non-Sharia firms) to ensure the compatibility of the implementation of the efficiency model on firm performance.