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Managerial Dominance over the Board and Audit Committee Independence in Financial Institutions

Author

Listed:
  • Charbel Salloum

    (CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises - UL - Université de Lorraine, GW - The George Washington University)

  • George Jabbour

    (CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises - UL - Université de Lorraine, GW - The George Washington University)

  • Jacques Digout

    (CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises - UL - Université de Lorraine, Groupe École Supérieure de Commerce de Toulouse - ESCT)

  • Elias Gebrayel

    (CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises - UL - Université de Lorraine, USEK School of Business - Holy Spirit University of Kaslik, Jounieh, Lebanon)

Abstract

The purpose of this paper is to analyze whether the degree of control exercised by management affects the independence of the audit committee over the board of directors. Four characteristics of the bo ard are being examined; size, composition, CEO duality and manage ment ownership. Results from a samp le of 54 Lebanese banks operating in various Lebanese territories during the period 2009-2011 show that all of these banks created an audit committee between 2009-2011 and comply with Lebanese central ba nk regulations (BDL) to guara ntee their independence from management which requires the audit committee in Lebanese ba nks to be including independent members. Empirical results suggest that in Lebanese banks, managers can impair the effectiveness of audit committees by the presence of inside directors on the board and CEO duality.

Suggested Citation

  • Charbel Salloum & George Jabbour & Jacques Digout & Elias Gebrayel, 2015. "Managerial Dominance over the Board and Audit Committee Independence in Financial Institutions," Post-Print hal-01371710, HAL.
    • Handle: RePEc:hal:journl:hal-01371710
    Note: View the original document on HAL open archive server: https://hal.science/hal-01371710
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    References listed on IDEAS

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