Does Corporate Governance Affect the Financial Performance? Analysis of Findings from Jordanian Banks

Abstract

The present study explored the impact of corporate governance on the financial performance of selected Jordanian banks. The study is based on secondary data collected from Annual Reports of Companies, research papers, articles and various websites. The sample of the study consists of five banks of Jordan. Multiple regression has been used as the statistical tool to measure the impact of corporate governance on the financial performance of banks under study. Corporate governance score is taken as independent variable while ROA is used as dependent proxy variable of financial performance. The findings of the current research highlighted that corporate governance score has a positive significant impact on the financial performance of Capital Bank of Jordan, Arab Bank, and Bank Al-Etihad. However, significant impact does not found on the financial performance of Jordan Islamic Bank and Jordan Dubai Islamic Bank.