Performance and governance in microfinance institutions

Roy Mersland and R. Øystein Strøm
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Roy Mersland: UIA - University of Agder

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Abstract: We trace the relationship between firm performance and corporate governance in microfinance institutions (MFI) utilising a self constructed global data set on MFIs, collected from third-party rating agencies. We study the effect of board characteristics, ownership type, competition and regulation on the MFI's outreach to poor clients and its financial performance. The results show that split roles of CEO and chairman, a female CEO, and competition are important explanations. Larger board size decreases the average loan size while individual guaranteed loan increases it. No difference between nonprofit organisations and shareholder firms in financial performance and outreach is found.

Keywords: Microfinance organisation; governance; performance JEL classification codes: G30; G32; J23; Microfinance organisation governance performance JEL classification codes: G30 G32 J23 (search for similar items in EconPapers)
Date: 2009
Note: View the original document on HAL open archive server: https://hal.science/hal-05217846v1
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Published in Journal of banking & finance = Journal of banking and finance, 2009, 33 (4), pp.662 - 669. ⟨10.1016/j.jbankfin.2008.11.009⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05217846

DOI: 10.1016/j.jbankfin.2008.11.009

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