The Effect of Board Composition on the Financial Performance of Commercial Banks in Cameroon

Abstract

The main driver of business engagement is to maximise shareholders net value.Investment is the postponement of present consumption for future gratifications. Therefore, investors will be interested in the value of the expected return on their investment ascompares to their opportunity cost. Successful leadership represents one of the most important factors that contribute to the enterprise success. Koontz et al. (1990) define leadership as a process of influencing employees in order to motivate and encourage them to achieve the enterprise's goals. Griffin(2002) believes that leadership is both a process and a trait. As a process, leadership represents the focus on activities that a leader takes, and as a trait, leadership represents leader's traits. Leadership can also be defined as the skill of encouraging employees to participate voluntarily in the realization of enterprise's goals (Rožman et al., 2017).It is important to point effective leadership leads to increase in the shareholder value. The responsibilities to lead organisations lies with the board of directors. These responsibilities of the directors include setting the company's strategic aims, providing the leadership to put them into effect, supervising the management of the business and reporting to shareholders on their stewardship which constitute the core of corporate governance. The Board's actions are subjected to laws, regulations and the shareholders in general meeting (Olayiwola, 2010).