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Board of Directors and Profitability: The Case of Tunisian Private Banks

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  • Mouna Gouia Ben Zina

    (Superior Institute of Applied Sciences and Technology of Sousse, Tunisia)

Abstract

The issue of the impact of the Board of Directors on banking performance is still being discussed. There is indeed a controversy on the topic to the point that drawing clear conclusions is a bit rash. In this paper, our aim then is to extend the issue by measuring the impact of the presence of independent directors, board structure and duality of functions on banking performance. To this end, we use a Generalized Method of Moment (GMM) estimation to study these relationships in a sample of seven private banks in Tunisia observed over the 2008 – 2017 period. We found evidence pointing to the presence of a negative correlation between duality of functions, board size and performance. Conversely, the relationship between independent directors and performance is found to be positive and significant.

Suggested Citation

  • Mouna Gouia Ben Zina, 2019. "Board of Directors and Profitability: The Case of Tunisian Private Banks," Eurasian Journal of Business and Management, Eurasian Publications, vol. 7(1), pages 11-17.
    • Handle: RePEc:ejn:ejbmjr:v:7:y:2019:i:1:p:11-17
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    References listed on IDEAS

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    1. Andres, Pablo de & Vallelado, Eleuterio, 2008. "Corporate governance in banking: The role of the board of directors," Journal of Banking & Finance, Elsevier, vol. 32(12), pages 2570-2580, December.
    2. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
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