This paper briefly overview results of a survey conducted in 2015 in North Cyprus on thirteen firms randomly selected from different sectors of the economy based on a comprehensive eight elements corporate governance model.
The previous study revealed that, (1) firms in North Cyprus on average had lower governance rankings due to inefficient legal framework; (2) at firm level internal and external governance positively correlated with the corporate culture and corporate legality elements but negatively correlated with average corporate governance rankings which implied that firm level corporate governance mechanism need to improve. (3) Proper corporate governance was positively associated with internal and external governance behaviour of firms. (4) There was internal country level financial market inefficiency and the negative incorporation between internal and external governance implied that there is a need for enforcement to improve the capital market in North Cyprus. The study aims to corroborate all the results with banking sector in North Cyprus and stress the importance of the elements in the proposed model to address the dilemma about 1) leadership effectiveness; and 2) financial innovations for better running companies in the banking sector.
The new research evidence revealed that, improvements in the corporate market culture and corporate legality elements provisions and enforcement and improvement in the overall legal framework of capital market increased the overall mean corporate governance score leading to better leadership effectiveness and financial innovations in the banking sector which opens up new ways of conducting further research.
Keywords: Corporate Governance; Corporate Culture; Corporate Legality; Leadership effectiveness; financial innovations