The purpose of this research was to investigate the effect of the characteristics of the executive director and the audit committee on the bank's financial performance. The statistical population studied in this research are the banks admitted to the Tehran Stock Exchange during the years 2015 to 2024. The statistical sample is based on the screening method. Finally, 16 banks were selected as a sample. The present research is a descriptive-correlational type of research, based on the nature of the data, it is a quantitative research type, and based on the objectives, it is considered an applied research type. The results of this research, which was based on research hypotheses, showed that the characteristics of the CEO play a key role in the financial performance of banks. The analysis showed that there is a significant relationship between the CEO's gender and the bank's financial performance. Also, there is a significant relationship between the CEO's level of education and the bank's financial performance. There is a significant relationship between the CEO's experience and the bank's financial performance. There is no significant relationship between the increase in the CEO's tenure, the CEO's ownership and the bank's financial performance. On the other hand, the audit committee, as a moderating variable, has an effect on the relationship between the CEO's characteristics and the bank's financial performance. This finding indicates that the audit committee can play an effective governance role in strengthening or weakening the effect of the CEO's characteristics on the bank's performance. The findings of the research can be useful for policy makers and bank managers in selecting and evaluating CEOs as well as improving the audit system in order to increase the financial efficiency of banks. It is suggested that other variables such as environmental and economic factors should be investigated in future researches.
Introduction
With the emergence of large companies and the formation of the huge issue of separation of ownership from management and the creation of a huge conflict of interest between owners and managers, evaluating the financial performance of banks and their managers and leaders is a topic of interest to various groups such as creditors, government owners, and even managers. From the shareholders' perspective, the amount of wealth increase, whether through an increase in the price and value of the company or through cash profits, is important. These assessments are of fundamental importance to managers in terms of evaluating their own performance and that of other departments, as well as the correct amount of compensation that is paid to them and is their undisputed right. From the governments' perspective, these assessments are important for achieving the three goals of optimal allocation of resources as the main goal, fair distribution of income, and stabilization of economic conditions by participating in economic activities.
The company's executive managers, especially the CEO, play a fundamental role in the company's strategic decisions. In the past decades, the responsibilities of CEOs have increased significantly, and this has led to an increase in their compensation. The CEO plays a key role in the organization and operations and is considered as a liaison between senior managers and board members. Despite the high caution of the committees, the CEO has a key role in the selection and hiring of managers. The CEO can directly or indirectly influence the board of directors through the appointed members to influence their performance evaluation. CEOs not only have absolute power in making decisions about the company's operations, but also have significant and influential power in the company's strategic decisions. Therefore, top managers, especially CEOs, stand at the top levels of the organizational structure, whose decision-making power clearly has significant effects on the company's operations. As a result of the emergence of the concept of corporate governance in the past decades, CEOs are now required to participate in the company's decision-making process, especially in financial matters (Boval and Hochberg, 2018).
Corporate performance is a popular topic that has been the subject of much research. One of the major concerns of investors is the bank's financial performance, which is influenced by several variables. Given the importance of the CEO in the company's strategic decision-making process, CEO characteristics are considered one of the most influential variables affecting the bank's financial performance.
According to Falk et al. (2020), the CEO is considered the most influential and powerful person in any organization. One of the previous studies has shown that the CEO can change the selection of other members if he owns a significant part of the company.
Discussion and Conclusion
The results show that the gender of the CEO has a positive effect on the bank's financial performance, which is measured by return on assets. In this regard, previous studies have shown that female CEOs are more cautious. |
