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The purpose of this paper is to examine the determinants and convergence of government effectiveness in African and Asian countries.

The study utilizes data from 100 countries in Africa and Asia from 2002 to 2018. The panel-corrected standard error regression is used for the regression analysis, while both beta-convergence and sigma-convergence among the countries are tested.

Both beta-convergence and sigma-convergence exist among African and Asian countries. Asia performs better than Africa across all indicators except for press freedom, and voice and accountability. Corruption perception index, government size, voice and accountability, regulatory quality and economic wealth have a significant positive effect on government effectiveness. Press freedom negatively impacts on government effectiveness, suggesting that freedom is necessary but not sufficient if there are political actors whose actions undermine freedom. Similarly, the political constraint index, as reflected by checks and balances are necessary but not sufficient to enhance government effectiveness, especially in Asia.

The results reveal that for press freedom and political checks and balances to enhance government effectiveness, there is a need for a different and holistic approach. The results are relevant for policymakers, public sector practitioners and academics.

This study utilizes a new dataset and is premier in exploring the convergence of government effectiveness among African and Asian countries.

This study aims to examine the effect of anti-corruption disclosure on the profitability and financial stability of extractive firms in Africa. It also tests the convergence of profitability and financial stability.

The study uses an unbalanced panel data of 27 firms operating in five African countries covering the period 2006–2018. Anti-corruption assessment is done in line with GRI 205: Anti-Corruption. Profitability is measured using the return on asset and return on equity, whereas the z-score measures financial stability. The study uses the panel-corrected error regression technique for estimation.

There is evidence that corruption disclosure reduces the financial stability of firms. Disclosures on corruption analysis and corruption training are the main factors driving the reduction in financial stability. The effect on profitability is not significant except in the case of disclosure on corruption response, which also reduces profitability. There is strong statistical evidence to suggest that profitability and financial stability of extractive firms converge. This suggests that less-performing firms catch up with high performers.

The study has relevant implications for practitioners, policymakers and the academic community. The study uses data that is skewed towards large extractive firms.

This study is premier in exploring the effect of anti-corruption disclosure on performance metrics among extractive firms in Africa. It is also unique in providing a test of both beta and sigma convergence of performance among the firms.

The purpose of this paper is to examine the impact of intellectual capital and its components on bank diversification choice.

Both asset and income diversification are computed and an unbalanced panel data set of 32 banks covering the period 2000–2015 have been used. The panel corrected standard error regression has been used to account for serial correlation and heteroscedasticity.

The study found that intellectual capital determines the choice of diversifying. Precisely, intellectual capital motivates asset diversity but it dissuades income diversification. Human capital and structural capital are major components that determine asset diversity decisions. Income diversification decision, in this case to choose a focus strategy, is determined by human capital. This gives credence for the human capital theory in Ghana. Competition encourages a focus strategy. Bank size and leverage enhances income diversification while stock exchange listing and government ownership fosters the focus strategy.

Diversification strategy, knowledge base of staff, corporate governance and internal control have been considered as factors leading to the collapse of some Ghanaian banks in 2017–2018. The study provides relevant insights for regulators, decision support units and corporate boards. Intellectual capital and value added metrics should be used for modelling and decision making as they have value relevance.

This is a premier study that has examined the nexus between diversification strategy and intellectual capital in banks.

This paper investigates the impact of intellectual capital and its components on slack-based technical efficiency (SBM-TE) of banks.

Data envelopment analysis is used to compute SBM-TE scores and the Value-Added Intellectual Coefficient (VAIC™) model is used to measure intellectual capital. An unbalanced panel of 32 banks that operated from 2000 to 2017 has been used.

Overall, the efficiency scores are averaged at 79%, suggesting that an inefficient bank needs to enhance technical efficiency by 21% to be at par with the best performing banks. Beta-convergence and sigma-convergence exist among banks with faster speed evident among listed and local banks. Intellectual capital has a positive impact on SBM-TE and human capital is the main driver of technical efficiency among banks. This result is specifically evident among non-listed banks and foreign banks. Economies of scale property are also evident among the banks. Competition and asset tangibility inhibit technical efficiency among banks.

Banks are advised to invest in value-adding emerging technologies and their employees so as to enhance their efficiency. The study offers insights for policymakers, practitioners and researchers in emerging markets.

The study is premier in employing the SBM-TE to explain the intellectual capital and efficiency nexus, as well as, testing for both beta-convergence and sigma-convergence.

This study explores the effect of income diversification strategy on credit risk and market risk of microfinance institutions (MFIs) in Ghana as an emerging market.

The study is based on quarterly data of averagely 271 MFIs that have operated from 2016 to 2018. The dataset is unbalanced and pooled cross-sectional with 3,259 data points. The study measures the diversification strategy using income diversification indices, and accounting ratios to measure the other variables. We utilised the weighted least squares (WLS) approach to explore the nexus.

The findings show that income diversification is associated with better loan quality and credit risk management. Market risk increases with the level of income diversification of microfinance firms. It is evident that large MFIs can manage their credit risks well and can have a low default rate, depicting an overall U-shaped nexus. On the other hand, the effect of size on market risk is an inverted U-shaped. The effect of asset tangibility on credit risk is positively significant while the effect on market risk is negatively significant. High profitability enhances credit risk management leading to lower loan losses while in the case of diversified and profitable MFIs, they tend to invest more in government securities. The results suggest that MFIs that hold more cash and cash equivalents tend to have high loan loss provision and more government securities suggesting much attention should be paid to optimal cash management.

The results throw light on the credit risk and market risk profile of the firms and the effect of diversification strategies on them. The findings are relevant for effective macroprudential regulation, market regulation and prudential regulation of the microfinance sector.

The findings reveal the nature of income diversification strategy of MFIs in emerging markets such as Ghana, pointing out how they affect the risk exposure of MFIs that lend to the pro-poor population.

This is a premier formal assessment of the nexus between income diversification strategies and risk management among MFIs that serve the pro-poor population in the emerging market context.

The purpose of this paper is to investigate the impact of diversification on profitability, profit efficiency and financial stability of Ghanaian banks.

The authors employed a panel regression technique on a data set of 32 banks from 2000 to 2015. The data envelopment analysis is used to compute profit efficiency scores with credit risk accounted for.

The results suggest that income diversification decreases profit, profit efficiency and financial stability. The impact on profit and stability is U-shaped. The impact of asset diversification was found to be insignificant. High competition reduces both profitability and profit efficiency which is inconsistent with the quiet-life hypothesis of Hicks (1935), but financial stability increases with competition. High investment in tangible assets is associated with poor performance. Non-banking financial institutions that later became universal banks are not financially stable. Competition, size, age, government ownership and leverage which are controlled for and a sensitivity analysis conducted also provided relevant insights.

The results are relevant in understanding the events in the Ghanaian banking industry in 2017–2018. Income diversification strategy is essential in determining the performance of banks. Management has to figure out the extent and scope of their diversification to benefit from the strategy.

The authors examined diversification from the view-point of both the income statement and statement of financial position while most prior studies focused on only one aspect. The study is one of the few studies that employed the risk-adjusted profit efficiency measure in Sub-Saharan Africa.

The study examines the impact of risk on the profit efficiency and profitability of banks in Ghana.

Data envelopment analysis was used to estimate profit efficiency scores and accounting ratios were used to measure profitability. The panel corrected standard error regression was used to assess the nexus using a dataset of 32 banks from 2000 to 2015.

The paper found that the Ghanaian banking industry exhibits a variable return to scale property, suggesting that average costs change with output size. Profit efficiency score for banks closer to the efficiency frontier is 61%. Credit risk is significant in enhancing profit efficiency and return on equity. Market risk is relevant in improving profit efficiency, return on asset and asset turnover. To drive profitability, bank managers have to be committed to effective liquidity risk, insolvency risk and capital risk management. Operational risk reduces shareholders' returns. The impact of size, age, stock exchange listing, cost efficiency and competition have are all been discussed extensively.

The findings contribute to the knowledge on the risk-performance nexus and provide information that is valuable to academics, bankers and regulators for policy formulation. The findings are relevant to the newly established Financial Stability Council.

This paper appears to be among the premier attempts to examine the effect of various risk types identified in the Basel III framework on bank performance in Africa.

The purpose of this study is to examine the convergence and determinants of anti-corruption disclosures of extractive firms in Africa.

The study uses an unbalanced panel data of 27 firms operating in 5 African countries covering the period 2006 to 2018. Corporate data is collected from the global reporting initiative (GRI) database. The study uses an index to measure overall disclosure and individual items are coded as binary. The study uses fixed effects, panel logistic and panel-corrected standard error regression, depending on the type of dependent variable used.

The results indicate that the determinants of anti-corruption disclosure are membership in the United Nations global compact (UNGC) and Extractive Industry Transparency Initiative, multi-national enterprise status, corruption perception index and human development index (HDI). Specifically, UNGC membership and multi-national status enhance the disclosure on corruption analysis. Countries with a high prevalence of corruption tend to disclose more on corruption analysis. Disclosure on corruption training is high among firms that are UNGC signatories, countries with a high HDI and countries with a high prevalence of corruption. There is a weak effect of firm-level, industry-level and country-level factors on disclosures on corruption response.

The study provides insights on the use of GRI 205: Anti-Corruption, which has relevant implications for practitioners, policymakers and the academic community.

This study is premier in exploring anti-corruption disclosure with a special focus on extractive firms in Africa. It is also unique in providing a test of both beta and sigma convergence among the firms.

There are notable indigenous business models in the African context that have either been unexplored or are yet to be highlighted and given due attention at the international level. This chapter provides a cross-case analysis of the indigenous business practices of three ethnic groups across West Africa: Nigeria (Igbos), Ghana (Ewes) and the Benin Republic (Guns), thus viewing business models, from anglophone and francophone perspectives. Specifically, the chapter discusses the apprenticeship models igba-boi, of the Igbo society, dorsorsror, among the Ewes, and eyi alo within the Guns society and succession models in the three societies ‘Inochi anya, domenyinyi and eyi kanta’ respectively, with the aim of highlighting insights for practice, policy and academia. Historically, there have been relevant structures to ensure the transfer of knowledge and wealth to the next generation; this is driven by both cultural and traditional systems of the ethnic groups. The findings show that the family unit plays a significant role in building a sustainable channel, though informal, through which the heritage of business models is attained. To this end, the authors recommend leveraging the unique models of apprenticeship and business succession practised in these ethnic groups to support current policies, such as those relating to Technical and Vocational Education and Training (TVET).