Relationship between Corporate Governance and Financial Crisis: A Study of Ghana's Banking Sector

Abstract

 This study assessed the effect of corporate governance on the odds of the occurrence of financial crisis in Ghana. Annual data for the period 2010 – 2019, from twenty-two commercial banks selected by the criterion sampling techniques, were used. The binary logistic regression technique was employed to estimate the hypothesis formulated. Results revealed a significantly negative effect of corporate governance on the odds of financial crisis occurring among commercial banks in Ghana. The study concluded that good corporate governance practices tend to contribute to averting the occurrence of financial crisis. It was then recommended that management or board of directors of banks in Ghana pay serious attention to clients and their demands, level of risk to take, as well as risk management techniques to ensure that the right and profitable decisions are taken at all point in time.