| dc.description.abstract | This paper establishes facts to evaluate the
governance factors affecting the performance of micro
finance institutions in Sri Lanka, in terms of outreach
and sustainability. Through literature, five independent
variables under governance having an impact on
performance was identified, namely: remuneration ( fixed
/ variable) of managers, size of the board, independence
of the board via the presence of non affiliated board
members, the diversity of the board, and the availability
of an independent auditor within the organization. The
study is carried out based on a purposively selected sample
of 42 microfinance institutions operating in Sri Lanka,
which have been in operation for more than ten years.
Data was collected via a self administered questionnaire
and published financial data of these selected institutions
It was determined as evidenced in data that the type of
compensation received by the managers is not associated
with performance of the sampled Institutions. The results
identify trade-offs between micro finance institution`s
outreach and sustainability, based on the board size, and
on the proportion of unaffiliated directors. Moreover,
the study shows that a higher representation of female
members on the board (diversity), leads to better
performance. The study also reveals that availability
of an internal auditor does not indicate a significant
relationship on the performance of these Institutions. | en_US |
