The Impact of Entrepreneur‐CEOs in Microfinance Institutions: A Global Survey

27 Pages Posted: 6 Jul 2015

See all articles by Trond Randøy

Trond Randøy

University of Agder - School of Management

R. Øystein Strøm

OsloMet - Oslo Metropolitan University

Roy Mersland

University of Agder

Date Written: July 2015

Abstract

Microfinance is a global high‐growth industry, in which entrepreneurship is prevalent and substantial. Based on the theoretical argument that microfinance entrepreneur‐chief executive officers (CEOs) are “motivated agents” with a unique ability to hire and socialize mission‐oriented staff, we hypothesize that these CEOs produce more sustainable microfinance institutions (MFIs) with better social performance and lower costs. This study utilizes data from 295 MFIs in 73 developing countries, assessed between 1998 and 2010. Our empirical evidence suggests that entrepreneur‐managed MFIs feature higher social performance, greater financial sustainability, and lower costs.

Suggested Citation

Randøy, Trond and Strøm, Reidar Øystein and Mersland, Roy, The Impact of Entrepreneur‐CEOs in Microfinance Institutions: A Global Survey (July 2015). Entrepreneurship Theory and Practice, Vol. 39, Issue 4, pp. 927-953, 2015. Available at SSRN: https://ssrn.com/abstract=2626243 or http://dx.doi.org/10.1111/etap.12085

Trond Randøy (Contact Author)

University of Agder - School of Management ( email )

Adger Research Foundation
Serviceboks 422 Bygg H
N-4604 Kristiansand
Norway
47 3814 1027 (Phone)

Reidar Øystein Strøm

OsloMet - Oslo Metropolitan University ( email )

P.O. Box 4
Oslo, 0130
Norway
+47 97968500 (Phone)

Roy Mersland

University of Agder ( email )

Serviceboks 422
N-4604 Kristiansand, VEST AGDER 4604
Norway

HOME PAGE: http://www.uia.no/microfinance

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