Abstract
This study mainly evaluated the effect of Board composition on the performance of deposit money banks (DMBs) in Sub Saharan Africa (SSA) with special focus on the critical mass question. Specific objectives are determination of the effect of women directors and board composed of more non-executive directors on return on assets (ROA) and net interest margin (NIM) of the banks. Secondary data on six SSA countries and twelve banks collected for the period 2004 to 2016 were used. Panel data regression approach was employed with model selection subjected to Hausman tests. The study revealed among others that board with more nonexecutive directors has significant positive effect on ROA and NIM with significant positive relationship with ROA and NIM. Women directors have very negligible effect on performance of the DMBs while correlating negatively and insignificantly with ROA and NIM. It is therefore, concluded that though, nonexecutive directors have strong positive significant effect on performance of deposit money banks in Sub Saharan Africa and women directors indicate very negligible effect, the conflicts over the effect of the two variables are not yet fully resolved. It is recommended that DMBs should make room for at least three female directors in their boards while adoption and enforcement of gender quota by countries should be considered.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.