Title: Exploring corporate governance practices in Indian banks: the moderation effect of banks size

Authors: Najib H.S. Farhan; Saleem Ahmed Aqlan; Mamdouh Abdulaziz Saleh Al-Faryan

Addresses: Faculty of Business Studies, Arab Open University, Saudi Arabia ' Michigan Academy of Postgraduate Studies, Novi, Michigan 48374, USA ' School of Accounting, Economics and Finance, Faculty of Business and Law, University of Portsmouth, UK

Abstract: The current study explores corporate governance practices in an emerging market. The study is based on 38 Indian banks, covering ten years from 2010 to 2019. Data are retrieved from the Prowess IQ database. The findings reveal a significant difference in corporate governance practices in small, medium, and large banks. Furthermore, board of directors' composition has a significant impact on banks' financial performance. Further, directors' remuneration positively and significantly affects return on assets and total income of Indian banks. Moreover, bank size moderates the association between related party transactions, directors' remuneration, and the financial performance of Indian bank measures, except leverage. This study is unique as it examines the difference in corporate governance structure and related party transactions among small, medium, and large banks. Finally, the study introduces the interaction term to examine the moderation effect of bank size on the association between corporate governance practices and banks' financial performance.

Keywords: corporate governance practices; Indian banking sector; Prowess IQ database; interaction effect.

DOI: 10.1504/IJPM.2024.137328

International Journal of Procurement Management, 2024 Vol.19 No.4, pp.525 - 557

Received: 01 Nov 2022
Accepted: 06 Nov 2022
Published online: 12 Mar 2024 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article