Gender diversity, board monitoring and bank efficiency in ASEAN-5

We examine the effect of gender diversity and board monitoring (board size and independence) on bank efficiency. Using a broad panel of ASEAN-5 listed commercial banks over the period 1999-2012, we observe that gender diversity in bank board decreases cost and profit efficiency. This finding confirm...

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Main Authors:	Ramly, Zulkufly, Chan, Sok-Gee, Mustapha, Mohd Zulkhairi, Sapiei, Noor Sharoja
Format:	Conference or Workshop Item
Language:	English
Published:	Zes Rokman Resources 2015
Subjects:	HG1501 Banking
Online Access:	http://irep.iium.edu.my/44546/ http://irep.iium.edu.my/44546/ http://irep.iium.edu.my/44546/1/44546.pdf

id	iium-44546
recordtype	eprints
spelling	iium-445462018-01-17T04:02:46Z http://irep.iium.edu.my/44546/ Gender diversity, board monitoring and bank efficiency in ASEAN-5 Ramly, Zulkufly Chan, Sok-Gee Mustapha, Mohd Zulkhairi Sapiei, Noor Sharoja HG1501 Banking We examine the effect of gender diversity and board monitoring (board size and independence) on bank efficiency. Using a broad panel of ASEAN-5 listed commercial banks over the period 1999-2012, we observe that gender diversity in bank board decreases cost and profit efficiency. This finding confirms our concern that the appointment of female directors in bank board is merely to comply with regulatory requirement and the market for high performing women directors could be limited, particularly in the banking sector. Our result also shows that board independence increases bank efficiency, suggesting that higher ratio of independent directors is related to the board ability to monitor and advise management; thus improving efficiency. However, we find that board independence confounded the negative effect of gender diversity on bank efficiency. This finding suggests that the inclusion of independent women directors in bank board fails to mitigate the negative effect of gender diversity on bank efficiency. Alternatively, the positive effect of an independent director towards monitoring and advisory roles of the board weakens if the director is a woman. Further, we find a U-shaped relation between board size and bank efficiency. Banks exhibit decreasing return to scale with small board size, and when the board size multiply the banks started to have better efficiency level. Our result casts doubt on most extant literature that asserts that one board size (either small or large) is always the way to go for all organizations. Zes Rokman Resources 2015-08 Conference or Workshop Item PeerReviewed application/pdf en http://irep.iium.edu.my/44546/1/44546.pdf Ramly, Zulkufly and Chan, Sok-Gee and Mustapha, Mohd Zulkhairi and Sapiei, Noor Sharoja (2015) Gender diversity, board monitoring and bank efficiency in ASEAN-5. In: 7th Kuala Lumpur International Business, Economics and Law Conference 7 (KLIBEL7), 15th-16th Aug. 2015, Hotel Putra, Kuala Lumpur. http://klibel.com/klibel-7-volume-1-accounting-papers/
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HG1501 Banking
spellingShingle	HG1501 Banking Ramly, Zulkufly Chan, Sok-Gee Mustapha, Mohd Zulkhairi Sapiei, Noor Sharoja Gender diversity, board monitoring and bank efficiency in ASEAN-5
description	We examine the effect of gender diversity and board monitoring (board size and independence) on bank efficiency. Using a broad panel of ASEAN-5 listed commercial banks over the period 1999-2012, we observe that gender diversity in bank board decreases cost and profit efficiency. This finding confirms our concern that the appointment of female directors in bank board is merely to comply with regulatory requirement and the market for high performing women directors could be limited, particularly in the banking sector. Our result also shows that board independence increases bank efficiency, suggesting that higher ratio of independent directors is related to the board ability to monitor and advise management; thus improving efficiency. However, we find that board independence confounded the negative effect of gender diversity on bank efficiency. This finding suggests that the inclusion of independent women directors in bank board fails to mitigate the negative effect of gender diversity on bank efficiency. Alternatively, the positive effect of an independent director towards monitoring and advisory roles of the board weakens if the director is a woman. Further, we find a U-shaped relation between board size and bank efficiency. Banks exhibit decreasing return to scale with small board size, and when the board size multiply the banks started to have better efficiency level. Our result casts doubt on most extant literature that asserts that one board size (either small or large) is always the way to go for all organizations.
format	Conference or Workshop Item
author	Ramly, Zulkufly Chan, Sok-Gee Mustapha, Mohd Zulkhairi Sapiei, Noor Sharoja
author_facet	Ramly, Zulkufly Chan, Sok-Gee Mustapha, Mohd Zulkhairi Sapiei, Noor Sharoja
author_sort	Ramly, Zulkufly
title	Gender diversity, board monitoring and bank efficiency in ASEAN-5
title_short	Gender diversity, board monitoring and bank efficiency in ASEAN-5
title_full	Gender diversity, board monitoring and bank efficiency in ASEAN-5
title_fullStr	Gender diversity, board monitoring and bank efficiency in ASEAN-5
title_full_unstemmed	Gender diversity, board monitoring and bank efficiency in ASEAN-5
title_sort	gender diversity, board monitoring and bank efficiency in asean-5
publisher	Zes Rokman Resources
publishDate	2015
url	http://irep.iium.edu.my/44546/ http://irep.iium.edu.my/44546/ http://irep.iium.edu.my/44546/1/44546.pdf
first_indexed	2023-09-18T21:03:19Z
last_indexed	2023-09-18T21:03:19Z
_version_	1777410768411557888

Gender diversity, board monitoring and bank efficiency in ASEAN-5

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