Corporate Governance in the Banking Sector: Theory, Supervision, ESG and Real Banking Failures

This book provides an overview of corporate governance theories and investigates agency costs in the banking sector. It argues that banks are complex and opaque, and government implicit guarantees and deposit insurance systems reduce monitoring. The book also explores research on CG in the banking sector between 2000-2020 and finds that specific CG characteristics affect banks. It suggests that institutional investors are changing CG for the better, and that managerial biases and irrational investors can affect CG negatively. The book offers suggestions for regulators, researchers, and practitioners.

Format: Hardback
Length: 163 pages
Publication date: 12 May 2022
Publisher: Springer Nature Switzerland AG

This comprehensive book delves into the realm of Corporate Governance, offering a comprehensive overview of the most significant theories and exploring the myth and reality surrounding it. It argues that within the banking sector, there exist two distinct agency costs: bank depositors and shareholders versus directors and bank depositors versus shareholders and directors. These agency problems pose significant challenges due to the complexity and opacity of banks, as well as the implicit government guarantees and deposit insurance systems that reduce the monitoring of depositors.

To delve deeper into the research on CG in the banking sector, the book conducts a unique and innovative literature review spanning the period between 2000 and 2020. Through this review, it identifies specific characteristics of CG that impact banks, including risk appetite, performance, accounting quality, compensation, and corporate social responsibility disclosure. Furthermore, the publication emphasizes that institutional investors are playing a crucial role in improving CG, highlighting how major financial market factors such as rating agencies and sell-side financial analysts make CG visible.

In addition, the book investigates how managerial biases and irrational investors can negatively affect CG, leading to company distress. By examining these aspects, the book makes a threefold contribution: it provides suggestions for regulators on how to enhance bank supervision, it offers new research topics for scholars, and it connects CG theory with real-world cases of CG failure, providing valuable insights for practitioners.

Overall, this book is a valuable resource for anyone interested in understanding the complexities of Corporate Governance and its impact on the banking sector. It sheds light on the challenges and opportunities associated with CG, and offers valuable insights for policymakers, researchers, and practitioners alike.

Weight: 453g
Dimension: 235 x 155 (mm)
ISBN-13: 9783030975746
Edition number: 1st ed. 2022