Compliance and governance: evidence from financial institutions in Taiwan

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2 Citations (Scopus)


Purpose: The purpose of this study is to investigate whether financial institutions, which are highly regulated entities, experience fewer sanctions and have lower penalties (mandatory and regulatory) if they have better corporate governance performance (voluntary). Design/methodology/approach: This study uses unique corporate governance data endorsed by the authorities and sanction information for financial institutions in Taiwan from 2014 to 2020 to examine whether regulatory compliance is associated with corporate governance for financial institutions. This study also examines the moderating effects of shareholding concentration, governmental shareholding and foreign institution shareholding on this relationship. Findings: The positive association between compliance and governance is found. In addition, partial results show that the positive relationship is less profound when the shareholder concentration is higher and more profound when government shareholdings are higher. Originality/value: The findings of this study support the premise that a well-structured, non-mandatory corporate governance evaluation mechanism, that is actively established and monitored by the appropriate authorities, may influence the compliance performance of financial institutions which is mandatory and minimum social requirements.

Original languageEnglish
Pages (from-to)298-315
Number of pages18
JournalJournal of Financial Regulation and Compliance
Issue number3
Publication statusPublished - 2023 May 29

All Science Journal Classification (ASJC) codes

  • Finance
  • Strategy and Management


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