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How do different corporate governance structures fare under conditions of fundamental environmental transformations? Treating governance structure as a knowledge distribution mechanism embedded in institutional frameworks, the paper aims to propose that the efficiency of this knowledge diffusing process will increase organizational survival under a punctuational change.

Using the case of Chinese banking industry during 1897-1927, a period of rapid technological, economic, and regulatory shifts.

Money shops (qianzhuang) with decentralized, open and extended governance structure were better able to adapt to rapid changes in the environment and had a higher survival chance than ticket stores (piaohao) with centralized, closed and internalized governance structure.

When exogenous shocks dramatically change the environment, decentralized, open and extended governance structures can more easily discover new habitats in which a modified form of organization can thrive.

By examining the Chinese banking industry during the fundamental shift of the environment at the turn of the twentieth century, this paper sheds new wisdom on the understanding of the current turbulent world and helps us discover new solutions to cope with the institutional transition necessary to survive and prosper in the new world environment and pave the road ahead.

The purpose of this research is to reveal the impact of public legal protection on the efficiency of internal corporate governance in banks. In addition, this research proposes a new corporate governance index that could be employed by the banking sector to evaluate the performance of their internal corporate governance mechanisms.

Orbis database, annual reports and direct questionnaire are used to collect corporate governance data of 127 banks from 14 countries during 2020. The Mann–Whitney U-test is employed to compare the efficiency of corporate governance mechanisms based on three subsamples of countries having different legal protection levels (weak, middle and strong).

This research suggests a new corporate governance index for banks based on seven constructs and 62 variables. This new non-parametric index could be used by bankers to improve the monitoring process and enhance the overall performance of banking. The results of this research show that the existence of a strong public legal protection environment within a specific country enhances the efficiency of corporate governance mechanisms in the banking sector and thus, leads to improve the protection of shareholders, depositors and other relevant stakeholders. However, in countries that are characterized by weak legal protection level, the efficiency of corporate governance mechanisms is very low and there are possibilities of entrenchment, expropriation and extraction of private benefits. These findings could be interpreted within the prediction of agency, moral hazard, asymmetric information, political and entrenchment theories.

This research paper provides information that bankers and other relevant stakeholders in the banking sector working in MENA (the Middle East and North Africa) and European countries. A strong public legal protection level could improve the efficiency of internal corporate governance mechanisms within banks.

The motivation of the study is to shed further light on the question of whether the governance structure of Islamic banks (IBs) has an impact on the efficiency and risk of Islamic banks operating in the Gulf Cooperation Council (GCC) after the global financial crisis and during the period 2010–2018. This study aims to examine the extent of governance structure on the efficiency and risk of IBs as the effect of the financial crisis has been less on IBs. In addition, the authors are interested in the GCC region as it represents the hub of Islamic finance.

In this study, the authors examine how the banking governance structure affects the risk-taking and performance of IBs in the GCC countries between 2010 and 2018. The authors construct a banking governance index (CGI) composed of sub-indices for the board structure, risk management, transparency and disclosure, audit committee, Sharia supervisory board and investment account holders. Unlike the majority of previous studies, bank performance is measured with technical efficiency scores using a data envelopment analysis and the authors use a comprehensive CGI.

The results show that IBs in GCC countries adhere to 54% of the attributes covered in the CGI. The authors also note a lack of disclosure regarding the investment account holders and the audit committee. As well, the results indicate that bank governance is positively associated with risk-taking and bank efficiency. Banking risk is influenced by the Sharia board and risk management while bank efficiency is affected by the characteristics of the board structure and investment account holders.

To the best of the authors’ knowledge, this is the first study that has developed a comprehensive governance index for IBs in GCC countries that includes a wide range of governance dimensions. The study contributes to the literature on governance in the banking sector by simultaneously examining its impact on the risk-taking and efficiency of IBs and recognizes the dynamic relation between these three variables for IB.

Relying on the agency theory and the financial intermediation theory, the purpose of this paper is to examine to what extent risk governance would improve corporate governance and risk management effectiveness. The paper especially investigates the mediating role that would have the risk governance mechanisms in explaining both of the following relationships: the corporate governance–the banks’ performance, and the risk management–the banks’ performance.

This research uses the Baron and Kenny’s (1986) approach to investigate the mediating effect of risk governance; besides, the study refers to structural equation modeling in carrying out the appropriate panel regressions. The data collection was based largely on Bank scope Database, but some missing qualitative data were gathered manually from the banks’ annual reports available on the banks’ websites.

The study findings illustrate the significant role of risk governance mechanisms in improving both corporate governance and risk management’s effectiveness. Especially, this paper finds that risk governance is fully explaining the corporate governance–bank performance relationship, but risk governance would explain partially the risk management–bank performance relationship. Further, findings suggest that the internal corporate governance mechanisms seem to be more relevant than the external ones in improving the sample bank performance, and that risk management mechanisms seem to impede rather the sample bank performance.

The findings would make an important contribution to the current debate on the need to reinvent the optimal organization of the bank’s board and directorates and would allow readers to develop more cost-effective governance and risk-management thinking. Besides, the findings may help bank deciders and boards to rationalize costs and to focus only on the relevant corporate governance and risk management mechanisms. Finally, findings might illustrate to regulatory instance the importance of recommending risk governance in their coming corporate governance guidance.

The global credit crisis of 2008 caused significant difficulties to financial institutions, so it would be worth enlightening practitioners and policymakers, even regulators, on the importance of considering the level of potential risk and risk monitoring as a key component in the decision-making process, to strengthen the stability and resilience of banks in an increasingly uncertain environment.

The issues raised in the paper are important in that Islamic banking is an integral part of the global banking and finance industry. This paper extends the knowledge of the potential importance of the new concept of risk governance with specific reference to Islamic banking industry peculiarities. It also provides a telling illustration of the need for the enhancements of the Basel Committee’s prudential requirements as well as the accounting and auditing organization for Islamic financial institutions and Islamic Financial Services Board set out especially regarding the consideration of risk in the strategic decision process.

The purpose of this study is to examine the relationship between corporate governance and risk management of Indonesian banks.

Implementation of good corporate governance is measured by good corporate governance composite rating, which is the result of bank's self-assessment. Bank risk managements are measured by market risk, credit risk, liquidity risk and operational risk.

The study results showed that good corporate governance implementation in Indonesia was able to influence bank risk. There were differences in credit risk, liquidity risk and operational risk in banks with different governance ratings, but not at market risk.

The effectiveness of risk management and good corporate governance implementation is needed to enable banks to identify problems early, to follow up on rapid improvements and to be more resilient to crises. This study is an analysis of the relationship between corporate governance and banks' risk management in Indonesia. In particular, risk management is measured by four risks: market risk, credit risk, liquidity risk and operation risk.

The purpose of this paper is to explore the relationship between corporate governance and risk-taking behaviour of banks operating in the Middle East and North African (MENA) countries.

In doing so, the authors use a data set covering 165 banks located in 13 MENA countries over the period 2005–2012 and apply dynamic panel data methodology.

The results show that good governance acting in the interests of shareholders could lead to excessive risk taking; in this sense, a conflict of interest between the stakeholders, interested in the solvency of the financial system, and shareholders, trying to maximise their benefit, may occur. The greater risk can be reinforced by the governance of the country and a strong macro governance framework can incentivise a higher risk exposure in banks, showing the influence of bank regulation and law enforcement on the risks taken by banks.

To the best of the authors’ knowledge, this is the first paper showing that corporate governance is relevant for explaining risk taking at the country and bank levels in MENA countries.

The purpose of this research paper is to investigate the role of corporate governance in earnings management behaviour by US listed banks during the era of the Sarbanes‐Oxley Act (2003‐2008).

The paper examines the issue of accounting quality and corporate governance within banking corporations through the use of two different measures of earnings management, namely small positive net income and the difference between discretionary realized security gains and losses and discretionary loan loss provisions (LLPs), by applying a corporate governance index estimated from 63 governance provisions.

The research found convincing evidence that banks with efficient corporate governance mechanisms report small positive income to a lesser extent than banks with weak governance efficiency. Also well‐governed banks engage less in aggressive earnings management behaviour through the use of discretionary loan loss provisions and realized security gains and losses.

The findings could prove to be valuable to investors since they must take into consideration the efficiency of each bank's corporate governance and demand supplementary information in order to reach a better investment decision when earnings are not highly informative.

The findings could prove to be useful for regulators since they are responsible for the acceptable level of corporate governance standards. Thus, they must consider strengthening governance mechanisms either though new legislation or stronger enforcement where earnings management is of such magnitude to that serious impedes information transparency and quality.

The present study aims to bridge a gap in the literature by investigating corporate governance and earnings management behaviour during a period of transition to an intensively legalized governance environment (SOX Act). The results contribute further evidence to the ongoing debate about the effectiveness of established corporate governance mechanisms.

The purpose of this paper is to examine the relationship between corporate governance and financial stability of the Islamic banking institutions in Malaysia. Indeed, we do not know much about the relationship between the corporate governance variables and the financial stability of the Islamic banks (IBs) in Malaysia.

In this case, the level of bank stability is individually measured using the Z-score indicator. The corporate governance dimension in this study includes the Shari’ah board size (SBS) in addition to the size of board members and the proportion of independent directors in the board. Using a yearly bank-level data of 16 IBs in Malaysia from 2005 to 2015, this paper utilizes the fixed effect, the GLS random-effect models and the OLS methods to provide empirical evidences. Moreover, this work aims to focus on the country-level data of Malaysia’s banking sector and introduced the corporate governance variables in this model.

To the authors’ knowledge, this is the first empirical analysis of country-level data in the Malaysia’s banking industry with this research approach. The study found that the percentage of independent members in the board of directors has a significant positive impact on the financial stability of the IBs. However, the SBS and the size of board are found to have no influence toward financial stability.

With this paper, the authors hope to clarify the relationship between corporate governance and financial stability of the Islamic banking, and provide additional insights to the emerging literature of Islamic banking.

The purpose of this paper is to engage in a systematic examination of previous scholarship on the relationship between Sharia governance (SG), which is represented by the Sharia Supervisory Board (SSB), and the Internal Sharia Review (ISR), to determine whether the ISR can minimize financing risk in Islamic banking.

The literature search consisted of two steps: a randomized and systematic literature review. The methodology adopted in this article is a systematic literature review.

To reduce the risk of financing in Islamic banking, SG must be implemented optimally by making rules regarding the role of the SSB in supervising customer financing. In addition, it is a necessary to establish an entity that assists the SSB in the implementation of SG, namely, the ISR section, but there is still very little research on the role of the SSB and ISR in minimizing financing risk.

Establishing an ISR to assist the SSB in carrying out its duties has direct practical implications for Islamic banking: minimizing financing risks and compliance with Islamic Sharia principles. In addition, new rules regarding the role of SSBs and the ISR in reducing credit risk include monitoring customers to ensure that they fulfill their financing commitments on time. This new form of regulation and review can be used as a reference by the Otoritas Jasa Keuangan or Finance Service Authority to create new policies or regulations regarding SG, especially in Indonesia.

Subsequent research may introduce other more relevant variables, such as empirically testing the competence, independence or integrity of SSB and the ISR team as it attempts to minimize the risk of financing in Islamic banks. In addition, further research is expected to examine whether the SSB or the ISR team has a positive or negative influence on the risk of financing Islamic banks with secondary data.

This study aims to explore the relationship between risk governance characteristics (chief risk officer [CRO], chief financial officer [CFO] and senior directors [SENIOR]) and regulatory adjustments (RAs) in Organization for Economic Cooperation and Development public commercial banks.

Using principal component analysis (PCA) and regression models, the research analyzes a representative data set of these banks.

A significant negative correlation between risk governance characteristics and RAs is found. Sensitivity analysis on the regulatory Tier 1 capital ratio and the total capital ratio indicates mixed outcomes, suggesting a complex relationship that warrants further exploration.

The study’s limited sample size calls for further research to confirm findings and explore risk governance’s impact on banks’ capital structures.

Enhanced risk governance could reduce RAs, influencing banking policy.

The study advocates for improved banking regulatory practices, potentially increasing sector stability and public trust.

This study contributes to understanding risk governance’s role in regulatory compliance, offering insights for policymaking in banking.