Impact of Board Composition on Bank Performance : Evidence from the Indian Banking Sector

Authors

  •   Amit Kumar Singh Professor , Department of Commerce, Delhi School of Economics, University Enclave, Delhi - 110007.
  •   Varda Sardana Assistant Professor , Department of Commerce, Shri Ram College of Commerce, University Enclave, Delhi - 110 007
  •   Shubham Singhania Research Scholar , USME, DTU (Corr esponding Author), DTU East Campus Block E, Jhilmil Colony, Delhi - 110 095
  •   Aditya Vikram Assistant Professor (Guest), Gargi College, University of Delhi, Siri Fort Rd, Siri Fort Institutional Area, Siri Fort, New Delhi - 110 049
  •   Arun Kumar Attree Assistant Professor , Shaheed Bhagat Singh College of Commerce, Iron Railing Rd, Phase II, Sheikh Sarai, New Delhi - 110 017

DOI:

https://doi.org/10.17010/pijom/2022/v15i11/172520

Keywords:

Board of Directors

, Board Composition, Resource Dependency Theory, Agency Theory, Bank Performance, Corporate Governance

JELClassification Codes

, G21, G28, G32, M48

Paper Submission Date

, June 15, 2022, Paper sent back for Revision, October 30, Paper Acceptance Date, November 4, Paper Published Online, November 15, 2022

Abstract

India has recently witnessed a set of banking frauds, pointing toward the possibility of loose corporate governance mechanisms in the banking sector. The present study aimed to evaluate the composition of the board of directors in terms of the corporate governance parameters to assess whether they impacted the performance of the listed Indian banks. The hypothesis for the same was formulated based on the agency and the resource dependency theory . The study made use of the 34 public as well as private sector banks listed on the Bombay Stock Exchange 500 for a period of 12 years (2010–2022). The analysis was conducted using the STAT A software’s fixed-effect panel data regression model. The results suggested that board size, percentage of women directors, and percentage of independent directors on the board of banks impacted the financial performance of these banks. The study shed light on the mechanism and ways to improve bank performance using corporate governance parameters. It makes valuable contributions to the literature on corporate governance and shall be helpful for both managers and policymakers in formulating regulatory guidelines.

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Published

2022-11-01

How to Cite

Kumar Singh, A., Sardana, V., Singhania, S., Vikram, A., & Kumar Attree, A. (2022). Impact of Board Composition on Bank Performance : Evidence from the Indian Banking Sector. Prabandhan: Indian Journal of Management, 15(11), 8–23. https://doi.org/10.17010/pijom/2022/v15i11/172520

Issue

Volume 15, Issue 11, November 2022

Section

Articles
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Europe PMC

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