Can Governance Paradigm Influence Agency Cost, Risks, and Performances of Insurance Companies? An International Evidence

Event details

This event will discuss Insurance companies: their corporate governance structure and risk profile.

Abstract

This research explores the importance of a rule-based governance paradigm on agency cost, risks and inclusion of insurance companies. We use a sample of 351 insurance companies across 5 regions. Firm-level data were collected from the LSEG database and we use World Bank database to collect country-level data. The results confirm that insurance companies suffer greater agency costs, take lower risks and offer higher returns under a rule-based governance system. These results remain consistent with
robust proxies and after endogeneity corrections. We also find that insurance companies with a rule-based governance, operating in a country with a rule-based system are higher performers when measured using return on asset and stock return. Our findings are in line with the prudent man hypothesis and offer policy implications for regulators and insurance industry practitioners.

Biography

Dr. Sarkar Kabir is a Senior Lecturer in Finance and Director of Postgraduate Finance Courses at the School of Economics, Finance and Accounting (EFA), Coventry University. He is an ASPiRE fellow of the Centre for Financial and Corporate Integrity (CFCI) at Coventry University. Earlier, he was the Finance Subject Lead and Economics Curriculum Lead (interim) at EFA. Kabir is an Associate Editor of the International Journal of Islamic and Middle Eastern Finance and Management (IMEFM), International Journal of Islamic Finance and Sustainable Development. He is also a member of the editorial board of the Journal of Global Economy, Trade and International Business (JGETIB).
His research interests include corporate finance of financial institutions, corporate governance of financial institutions, financial crisis, Islamic banking and capital market, climate risk and finance, sustainable finance, and sustainable development goals (SDGs). He has published in the International Journal of Finance and Economics, Financial Markets, Institutions & Instruments, Emerging Markets Review, and Emerging Markets Finance and Trade.

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