CORPORATE GOVERNANCE „ACTORS”’ CAPABILITY AND RISK INFORMATION TRANSPARENCY – EMPIRICAL STUDY ON EUROPEAN BANKING SYSTEM

Cristina Alexandrina Stefanescu
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Cristina Alexandrina Stefanescu: Babeş-Bolyai University, Cluj-Napoca, Romania

Studies in Business and Economics, 2014, vol. 9, issue 2, 98-107

Abstract: The purpose of our empirical study is to assess the relationship between corporate governance „actors”’ capability and risk information transparency in European banking system. The research methodology used for achieving our goal is based on correlation tests and regression analyses for identifying and assessing the relationships between the “risk information disclosure index” developed and the experience and education of both board of directors and audit committees’ members. The results of the performed analysis reveal significant positive influences of governance actors’ capability on the level of risk information disclosure, thus confirming our assumptions that the higher the educational degrees and professional expertise, the higher the level of disclosure. Irrespective of prior studies, which were focused on various corporate governance features, our paper comes to add value to research literature by testing the same characteristic, namely “capability” from two of the most important actors’ perspective: board of directors and audit committee. Moreover, we also had the chance to enrich the literature with this empirical study not only by focusing on a specific field - the banking one, which was little explored on this topic before, but also by considering a particular area of disclosure – the risk information one, thus revealing how corporate governance actors’ capability affected financial institutions’ transparency in case of E.U. banking system.

Keywords: corporate governance; transparency; risk information; banking system; European Union (search for similar items in EconPapers)
Date: 2014
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