Authors: Mohammad Tazul Islam; Mohammed Mohi Uddin
Addresses: Dhaka School of Bank Management, Bangladesh Institute of Bank Management, Mirpur-2, Dhaka-1216, Bangladesh ' University of Illinois Springfield, One University Plaza, Springfield, IL, 62703, USA
Abstract: The study examines the determinants of board roles (BR) in the banking sector from a developing country - Bangladesh perspective. A measurement instrument is designed based on a comprehensive literature review. Board qualification (BQ), board composition (BC), board independence (BI), governance regulations (GR), and board conflict of interest (BCOI) have been used as determinants for BR. Nineteen latent variables of six constructs have been extracted using factor analysis. The study analyses 728 questionnaire survey responses by using the structural equation modelling (SEM) and finds that BQ, BC, BI, and GR are statistically significant and positively affect BR which indicates these determinants help improve the effectiveness of bank boards. Most importantly, the study finds that BCOI is negatively significant and adversely affects BR and organisational performance (OP) directly and indirectly. This study demonstrates that BCOI is a significant determinant of BR and bank performance in the banking sector of Bangladesh.
Keywords: board roles; BR; determinants of board roles; corporate governance; conflict of interest; COI; developing country; Bangladesh.
International Journal of Corporate Governance, 2022 Vol.13 No.2, pp.103 - 123
Received: 30 May 2022
Accepted: 14 Oct 2022
Published online: 02 Feb 2023 *