Does corporate governance affect Australian banks' performance?

Worldwide, recent corporate collapses have added to the insecurity of financial markets, triggering regulatory responses. This study provides empirical evidence of the relationship between corporate governance and the efficiency of Australian banks between 1999 and 2013, using two-stage double-bootstrap data envelopment analysis. Of the five corporate governance factors considered, we find board size and committee meetings have robustly significant and positive effects on efficiency. We also find evidence of improvements in overall industry efficiency following the 2003 introduction of the Principles of Good Corporate Governance, but not of any statistically-significant influence of the GFC.