This book gives an overview of the most important theories on Corporate Governance, investigating the myth and the reality of it. It argues that within the banking sector exist two new agency costs (i.e., bank depositors and shareholders vs. directors and bank depositors vs. shareholders and directors). These agency problems are difficult to reduce for two reasons. First, banks are complex and opaque. Second, government implicit guarantees and the deposit insurance systems reduce the monitoring of depositors.

This book also takes a deep dive into research on CG in the banking sector via a unique and innovative literature review covering the time period between 2000-2020. It finds that some specific CG characteristics affect banks: risk appetite, performance, accounting quality, compensation and corporate social responsibility disclosure.

Furthermore, this publication contends that institutional investors are changing CG for the better, describing how major financialmarkets factors such as rating agencies and sell-side financial analysts make CG visible. Additionally, it investigates how managerial biases and irrational investors can affect CG negatively, leading to company distress.

All-in-all, this book makes a threefold contribution: for regulators, it offers suggestions on how to improve banks' supervision; for researchers, it suggests new research topics; and for practitioners, it connects CG theory with real cases of CG failure.

Gives an overview of the most important theories on Corporate Governance (CG) Argues that within the banking sector exist two new agency costs Connects CG theory with real cases of CG failure in the banking sector

Autorentext

Nordine Abidi was an Economist in the Monetary Policy Department at the European Central bank (ECB). He was responsible for monitoring, analysing and conducting studies on the non- bank transmission of monetary policy and on cyclical and structural developments in the financial markets that have an impact on the euro area from a monetary policy perspective. He was also in charge of the evaluation of the ECB's corporate asset purchase programme. Since September 2019, he joined the International Monetary Fund (IMF) and worked on a variety of analytical and policy endeavours (e.g. monetary and capital market issues, policy response to the COVID-19 crisis, regional economic outlook). He obtained a Ph.D. in Economics from Toulouse School of Economics, France in 2016. Bruno Buchetti is an Assistant Professor of Financial Accounting at the University of Padua, Italy. He also serves as an adjunct professor at Toulouse Business School (TBS), where he teaches International Corporate Governance. Previously, he worked at the European Central Bank in Frankfurt am Main, Germany, as a Supervision Analyst in the "COI - Centralized On-Site Inspections" division of the Single Supervisory Mechanism (SSM). He has also been employed at Credit Suisse AG in Zurich, Switzerland, as a bank inspector. Dr. Buchetti earned his PhD in Management & Innovation from UCSC University in Milan, Italy. He has a BSc in Economics & Business Administration and an MSc in Banking & Finance (earned with summa cum laude). During his MSc studies, he was awarded a scholarship for academic merit and participated in an exchange program at Stanford University in California, USA. He is the author of "Corporate Governance and Firm Value in Italy: How Directors and Board Members Matter" and "Corporate Governance in the Banking Sector: Theory, Supervision, ESG, and Real Banking Failures," both published by Springer Nature in 2021 and 2022, respectively. His primary research interests center on corporate governance, financial accounting, and banking. Samuele Crosetti is a Bank Resolution Expert at the Single Resolution Board (SRB), where he carries the ongoing tasks of resolution planning and resolvability assessment for the banks in its portfolio. Before joining the Single Resolution Board, he worked as Supervision Analyst in the European Central Bank, as part of the Joint Supervisory Team of a G-SIB and member of the ECB Brexit Task Force. Alongside his main professional activity, Samuele Crosetti is a PhD candidate at Maastricht University, where is conducting research on the impact of resolution regimes and their operationalisation on financial and non-financial crisis resilience of banks. Since 2017 he has been pro bono teaching assistant of Public Economic Law at LUISS University in Rome. Ixart Miquel-Flores is a doctoral candidate in the Finance Department at Frankfurt School of Finance & Management. He has as well been a visiting Ph.D. student to the finance departments in The University of Virginia Darden School of Business, as well as The University of Chicago Booth School of Business. He uses modern applied econometric methods to understand the effects and consequences of monetary policy, financial regulation and new technologies on the banking sector and other macro-financial stability issues. He is focused on producing policy-relevant studies. His research has been the focus of articles in reputable newspapers such as the Financial Times and Les E chos, as well as blogs such as Quantpedia and the Oxford University Business Law Blog. Ixart works at the European Central Bank (ECB), where he has acquired experience in different fields such as Monetary Policy and Banking Supervision (Crisis Management, Market Risk and Valuation Banking Inspections, Quantitative Risk Analysis in the context of Market Risk Stress Testing as well as Banking Cyber Resilience Stress Testing). He is a member of the European Banking Institute Young Researchers Group, and has obtained th

Inhalt

Chapter 1. The Meaning of Corporate Governance and Its Role in the Banking Sector.- Chapter 2. Corporate Governance Theories and the Banking Sector.- Chapter 3. Corporate Governance in the Banking Sector: A Literature Review.- Chapter 4. CG Stock Markets and the Environmental, Social and Corporate Governance (ESG) Indicators.- Chapter 5. Corporate Governance and Behavior Finance.- Chapter 6. Why Corporate Governance Matters - Spectacular Defaults.