Research Article

Corporate Governance and Financial Risk Management in Financial Institutions: A Systematic Literature Review and Future Research Agenda

Authors

  • Evans O. N. D. Ocansey Senior Lecturer, Department of Accounting & Finance, Valley View University, Accra, Ghana https://orcid.org/0000-0002-5176-1809
  • Michael Ofosu Antwi PhD Student, Department of Accounting & Finance, Valley View University, Accra, Ghana

Abstract

Corporate governance has become a critical determinant of financial stability, organizational resilience, and effective risk management in financial institutions. Following the global financial crisis of 2007–20G09 and subsequent regulatory reforms, considerable scholarly attention has focused on understanding how governance mechanisms influence organizational risk-taking and financial performance. However, existing evidence remains fragmented across governance dimensions, institutional contexts, and theoretical perspectives. This study systematically reviews the literature on corporate governance and financial risk management in financial institutions using the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA 2020) framework. The review synthesizes empirical studies published between 2013 and 2025, examining the influence of board characteristics, ownership structures, board risk committees, Chief Risk Officers, enterprise risk management, internal controls, transparency, risk disclosure, and organizational risk culture on financial risk management. The findings indicate that effective governance generally contributes to lower financial risk, stronger organizational resilience, improved regulatory compliance, and enhanced financial stability. Nevertheless, the review also reveals that governance effectiveness depends less on the existence of formal governance structures than on their quality, independence, expertise, authority, and integration within organizational decision-making processes. The study further identifies significant contextual and methodological gaps, particularly the limited evidence from emerging economies, including Africa, and the growing need to investigate governance responses to cybersecurity, artificial intelligence, fintech innovation, climate-related financial risks, and Environmental, Social, and Governance (ESG) issues. The review contributes to the corporate governance literature by integrating multiple theoretical perspectives, synthesizing contemporary empirical evidence, identifying unresolved research gaps, and proposing a comprehensive agenda for future research. The findings provide practical insights for policymakers, regulators, boards of directors, and financial institutions seeking to strengthen governance systems and improve long-term financial stability.

Article information

Journal

Journal of Economics, Finance and Accounting Studies

Volume (Issue)

8 (9)

Pages

Published

2026-08-24

How to Cite

Ocansey, E. O. N. D., & Michael Ofosu Antwi. (2026). Corporate Governance and Financial Risk Management in Financial Institutions: A Systematic Literature Review and Future Research Agenda. Journal of Economics, Finance and Accounting Studies , 8(9). https://doi.org/10.32996/jefas.2026.8.9.1

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Keywords:

Corporate governance, Finanncial risk management, Financial institutions, Board governance, Enterprise risk management , Risk governance