Board Governance: Does Ownership Matter?

Dear Colleagues

Happy to announce our most recent article published in Annals of Public and Cooperative Economics.

Also happy to share that the article has been selected as the Editor’s choice article and made available as open access.

Hideto, M., Hudon, M., & Mersland, R. (Forthcoming), “Board Governance: Does Ownership Matter?”, Annals of Public and Cooperative Economics.

You can read the full article here: Editor’s Choice page

In the article we ask: Do for-profit and not-for-profit organizations organize their boards similarly or differently? Is there a “best practice” governance model across ownership types? Empirically speaking, these are tricky questions to study because generally for-profit and not-for-profit firms deliver different types of services in different types of markets. The microfinance industry is an exception. In this industry for-profit and not-for-profit actors operate side by side delivering banking services to low income families to finance their income generating activities. Using data from the microfinance industry we find that compared to for-profit actors the not-for-profit actors have larger boards, larger percentage of female directors and more frequent board meetings. we further find that the not-for-profit organizations enhance their performance when their boards are larger and meet more frequently. Equally interesting, while having a larger fraction of female directors is beneficial on average it significantly negatively affects the performance of not-for-profit microfinance organizations. Taken together, the findings in this paper send a strong message to observers, policy makers and not-for-profit organizations: Such organizations should not copy the board structure of regular firms but develop their own governance models fitting their needs in accordance with their ownership type.

I hope you enjoy reading the article.

Best wishes,

Roy Mersland

Professor/Director PhD program

Director Center for Research on Social Enterprises and Microfinance (CERSEM)

School of Business and Law

University of Agder

The EMP starts its 2020-2021 recruitment campaign!

Dear colleagues

Our friends at CERMi at Solvay in Brussels run an excellent master program in Microfinance. I am happy to teach a course at the program and recommend it warmly. See more information about the program below.

Please help sharing this opportunity with relevant candidates. Thanks a lot.

Best wishes,

Roy Mersland

Professor/Director PhD program

Director Center for Research on Social Enterprises and Microfinance (CERSEM)

School of Business and Law

University of Agder

Available PhD Positions

Dear Colleagues

Please help me to share these opportunities:

We are hiring PhDs. We are searching for strong candidates interested in:

  1. Internationalization & Microfinance (1 candidate)
  2. Savings groups (2 candidates)

The opportunity in Internationalization & Microfinance is tied to our general PhD program in International Business where we at the moment are searching for up to 5 candidates. More information is found here: https://www.jobbnorge.no/en/available-jobs/job/179776/phd-reserach-fellow-in-international-business

The two opportunities on Savings Groups are tied directly to CERSEM. For these we offer a full waiver of university fees plus a scholarship of around EURO 1000,- monthly to cover living costs. One position will focus on “Inclusion of disabled members in savings groups” while the other will focus on “survival of savings groups”. For this later position fluency in French is required. You can read more about our research on Savings Groups here https://www.researchgate.net/publication/333238735_Global_Indicators_of_Savings_Groups

For all positions fluency in English, strong academic qualifications and very strong knowledge in econometrics are required.

Interested candidates should get in touch directly with me.

Best wishes,

Roy Mersland

Professor/Director PhD program

Director Center for Research on Social Enterprises and Microfinance (CERSEM)

School of Business and Law

University of Agder

Is it wise, on average, for a microfinance bank to diversify geographically?

Check out our new paper accepted for publication in Journal of Banking and Finance https://lnkd.in/gsQS73B.

Since start-up in 1997 I have been involved in the microfinance bank BANCO D-MIRO in Ecuador. Many stakeholders have assessed our performance. Especially international lenders and rating agencies. What has always annoyed me is that they have repeatedly told us that we should diversify our geographical risk by entering more regions. I have fought against this recommendation because I think it requires more coordination resources to operate with larger geographical outspread. Moreover, I think geographical concentration gives us improved market knowledge. This background has motivated me to carry out this new research project together with my colleagues Stephen Zamore and Leif Atle Beisland. In the paper we are the first to study the link between geographic diversification and credit risk in microfinance. Who was right? I or the rating agencies? Check out the paper!

(P.S. since we use a large global dataset it could still be that the rating agencies are right in the case of Banco D-MIRO 😊)  

Best wishes,

Roy Mersland

Professor/Director PhD program

Director Center for Research on Social Enterprises and Microfinance (CERSEM)

School of Business and Law

University of Agder

International market selection by European and American impact investing organizations

Dear Colleagues

Into what type of developing countries do social enterprises expand when going international? Do they select markets where they have a better chance of achieving social returns or do they expand into countries offering better chances of financial returns?

In a new paper we examine how host countries’ macroeconomic conditions influence international market selection of European and American impact investing organizations.

  • Mersland, R., Nyarko, S., & Sirisena, A. (Forthcoming), “A Hybrid Approach to International Market Selection: The Case of Impact Investing Organizations”, International Business Review.

Download and read the full paper here: https://www.researchgate.net/publication/335818278_A_hybrid_approach_to_international_market_selection_The_case_of_impact_investing_organizations

Best wishes,

Roy Mersland

Professor/Director PhD program

Director Center for Research on Social Enterprises and Microfinance (CERSEM)

School of Business and Law

University of Agder , Norway

What are savings groups?

Dear Colleagues,

Do you know what savings groups are, how they are structured, how they perform and where they flourish? In fact, saving groups are one of the World’s largest banking systems. Here at CERSEM, we find savings groups fascinating and have therefore initiated a large new project where we will research what drives the performance of these groups. The project is sponsored by FAHU foundation and we have gotten access to the SAVIX database covering 250 thousand groups worldwide. Our first output is a descriptive report on the content in the SAVIX database. Read the report and learn about savings groups.

Check it out at:
https://www.researchgate.net/publication/333238735_Global_Indicators_of_Savings_Groups

Best wishes

Professor Roy Mersland

Director Center for Research on Social Enterprises and Microfinance – https://cersem.uia.no/news/

UiA School of Business and Law

University of Agder, Norway

Tel: +47 924 34 333

https://www.uia.no/en/kk/profile/roym

https://www.researchgate.net/profile/Roy_Mersland

Our research catches attention.

Dear Colleagues,

Europe’s largest microfinance newsletter – The Microfinance Platform – has a long article reviewing our paper on Mission Statements in Microfinance. You can read the article here: https://lnkd.in/gHnBEiN
The full article can be requested here: https://lnkd.in/gRcK8n2

Best wishes,
Professor Roy Mersland

Director Center for Research on Social Enterprises and Microfinance – https://cersem.uia.no/news/

UiA School of Business and Law

University of Agder

https://www.uia.no/en/kk/profile/roym

DOES LANGUAGE USE AFFECT THE FINANCIAL PERFORMANCE OF MICROFINANCE BANKS?

Dear colleagues

In our most recent paper accepted for publication in Journal of World Business we study whether knowledge of a world language like English, Spanish and French have an influence on the performance of Microfinance Institutions (MFIs). And indeed it has. After controlling for country effects etc. we find that MFIs operating in English/Spanish/French-speaking countries have higher performance than MFIs operating in other markets. Moreover, we find that language also has an effect on partnerships between MFIs and international partners in Europe and North America. A closer language relationship between the international partner and the MFI has a positive effect on the MFI’s performance. We think our study is of relevance also outside the microfinance context. You can download and read the full study here: https://authors.elsevier.com/c/1Ypmi3u3RtdUg6    

Other CERSEM articles can be downloaded here: https://www.researchgate.net/profile/Roy_Mersland/publications

Best wishes

Professor Roy Mersland

Director Center for Research on Social Enterprises and Microfinance – https://cersem.uia.no/news/

UiA School of Business and Law

University of Agder, Norway

Tel: +47 924 34 333

https://www.uia.no/en/kk/profile/roym

DO MICROFINANCE INSTITUTIONS “WALK THE TALK”?

Dear Colleagues

Happy to announce our latest research which I think is novel. We are the first to study “mission statements” of Microfinance Institutions (MFIs) and assess whether MFIs “walk the talk”. To our surprise only one fifth of MFIs mention in their mission statements that they focus on women. However, the results show a significant coherence between what MFIs say in their mission statements and what they do in practice, suggesting that “missions drift” is no serious concern in the microfinance industry. You can download and read the full paper here: 

https://www.sciencedirect.com/science/article/pii/S2352673418301574?dgcid=author

Best wishes,

Roy Mersland

Professor

School of Business and Law

University of Agder, Norway

https://www.researchgate.net/profile/Roy_Mersland

Two of our Phd students defended their theses.

 At CERSEM we are very proud these days. On Thursday 13th of December two of our PhD students successfully defended their theses. We are also very thankful to FAHU foundation for funding their studies. Stephen Zamore and Kwame Djan, both from Ghana, have been brilliant students finishing their theses in only three years. Stephen has now been hired by us in a postdoc position. Kwame is in the job market so let us know if you are hiring. Both Stephen and Kwame have already published several interesting studies like this one by Stephen on whether it is beneficial for MFIs to integrate nonfinancial in their business models https://lnkd.in/dcD7bG8 and this one by Kwame on whether Christian MFIs are governed differently than secular MFIs https://lnkd.in/g4vZFBB.
 
Let us also take the opportunity to wish you a Merry Christmas. Stay posted in 2019 for more news from the Center for Research on Social Enterprises and Microfinance.

Best wishes,
Professor Roy Mersland
Director CERSEM
Director PhD program
School of Business and Law
University of Agder, Norway
https://www.researchgate.net/profile/Roy_Mersland