Corporate Governance, Risk Disclosure, and Financial Performance of Banks: A Systematic Literature Review

This systematic literature review explores the relationship between corporate governance (CG), risk disclosure (RD), and financial per-‎performance (FP) in the banking sector, synthesizing findings from studies across multiple regions and contexts. The review identifies key ‎CG mechanisms, such as board independence, ownership structure, audit committees, and RD, that significantly impact FP. Board independence and audit committee effectiveness are consistently linked to improved performance, while ownership concentration, particularly-‎ly in family-owned or government-owned banks, presents mixed results. RD, especially voluntary disclosure, enhances transparency, ‎reduces information asymmetry, and strengthens the positive effects of CG on FP. Despite these insights, several gaps in the literature ‎remain. Limited research has explored CG and RD practices in developing economies, and the moderating role of RD between CG ‎mechanisms and FP is underexamined. Furthermore, the impact of cultural and regional differences, particularly in Islamic banking, as ‎well as the role of CEO power and duality, are areas that require further investigation. Future research should address these gaps ‎through longitudinal studies and by focusing on emerging markets, where governance practices differ substantially from developed ‎economies. This review highlights the need for banks and policymakers to strengthen governance frameworks, promote transparency ‎through RD, and tailor CG practices to specific regional and institutional contexts to improve financial outcomes and stability‎.