Academy of Accounting and Financial Studies Journal (Print ISSN: 1096-3685; Online ISSN: 1528-2635)


Corporate Governance and Firm Performance in the Emerging Market: A Case Study of Deposit-Taking Institutions in the UAE

Author(s): Sayed Abbas Ahmed

Scholars in the field of Accounting and Finance have provided a controversial result with respect to the relationship between corporate governance and firm performance. An emphasis of scholars has been placed on developed rather than emerging and developing economies. In addressing the debatable issue of this relationship, the study is intended to investigate the relationship between corporate governance mechanism and profitability performance of banks, operating in the competitive financial market of the gulf region. The corporate governance was derived from the operational nature of banks. Profitability performance was measured by ROTA, ROE and the PM. Nine banks out of the population of 21 national banks have been selected as a research sample for the period 2010-2019 (post-era of the International Financial Crisis of 2008 and pre-pandemic COVID-19 crisis). The data has been analysed through the use of E-views software. The findings reveal strong relationship between lending capacity and optimal allocation of resources and profitability. This impliedly gives connotation to other variables which influence lending capacity. The results may help banks management understand the influence of corporate governance on operational performance of banks.

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