The Impact of Corporate Governance on Financial Sustainability

Abstract

The research aims to analyze the impact of corporate governance on financial sustainability, with a focus on the Iraqi banking sector. A sample of 10 Iraqi commercial banks listed on the Iraq Stock Exchange was used, covering the period from 2014 to 2023, with a total of 100 observations.Corporate governance was measured using a set of indicators, including: (Board size, board meetings, audit committee size, audit committee meetings, audit committee independence, gender diversity, managerial and institutional ownership).Financial sustainability was measured through the following indicators:(Return on assets, return on equity, current ratio, solvency ratio, and defensive interval ratio). The researcher employed advanced statistical analysis tools such as path analysis and linear regression using the programs (SPSS27, AMOS22, and EVIEWS). The results revealed a statistically significant positive relationship between corporate governance and financial sustainability. The researcher concluded that strengthening corporate governance mechanisms in banks positively impacts financial sustainability, thereby increasing investor confidence, reducing investment risks, and enhancing the competitiveness of Iraqi economic units in financial markets.