Corporate governance in microfinance institutions (MFIs) significantly influences their ability to pursue financial sustainability and social outreach, yet two decades of empirical research have produced fragmented and contradictory findings. This paper presents a systematic review of 47 peer-reviewed studies published between 2005 and 2025 that examine how governance mechanisms shape MFI dual performance. Rather than treating theoretical concentration and empirical inconsistency as symptoms of weak scholarship, we demonstrate that both reflect structural constraints embedded in prevailing data infrastructures. Widely used datasets, most prominently MIX Market, disproportionately support agency-theoretic constructs while rendering relational, institutional, and stakeholder governance dimensions largely unobservable, systematically shaping theory selection, empirical strategy, and reported findings across the literature. Building on these considerations, the review makes three contributions. First, it provides a structural explanation for why agency theory dominates the field and argues that theoretical diversification requires investment in richer data rather than simply broader lens selection. Second, it demonstrates that standard governance variables function as bundled proxies whose effects are contingent on organizational form, regulatory status, and stakeholder structure, and proposes simultaneous equations modeling to capture the feedback loops between financial performance and social outreach that single-equation designs cannot estimate. Third, it identifies informal and relational governance mechanisms, trust-based networks, board members’ social capital, and stakeholder embeddedness as theoretically central but empirically absent, and proposes longitudinal and mixed-method designs to address this blind spot. Together, these contributions reframe the research agenda on MFI governance and call for a redefinition of effective governance in hybrid, mission-driven organizations.

Cardillo, G., Cavallo, A., Torluccio, G. (2026). Corporate governance in microfinance institutions: A systematic review of theoretical perspectives, methodological approaches, and empirical evidence. WORLD DEVELOPMENT, 206, 107455-107455 [10.1016/j.worlddev.2026.107455].

Corporate governance in microfinance institutions: A systematic review of theoretical perspectives, methodological approaches, and empirical evidence

Cardillo, Giovanni
Primo
Membro del Collaboration Group
;
Cavallo, Alessandra
Secondo
Membro del Collaboration Group
;
Torluccio, Giuseppe
Ultimo
Membro del Collaboration Group
2026

Abstract

Corporate governance in microfinance institutions (MFIs) significantly influences their ability to pursue financial sustainability and social outreach, yet two decades of empirical research have produced fragmented and contradictory findings. This paper presents a systematic review of 47 peer-reviewed studies published between 2005 and 2025 that examine how governance mechanisms shape MFI dual performance. Rather than treating theoretical concentration and empirical inconsistency as symptoms of weak scholarship, we demonstrate that both reflect structural constraints embedded in prevailing data infrastructures. Widely used datasets, most prominently MIX Market, disproportionately support agency-theoretic constructs while rendering relational, institutional, and stakeholder governance dimensions largely unobservable, systematically shaping theory selection, empirical strategy, and reported findings across the literature. Building on these considerations, the review makes three contributions. First, it provides a structural explanation for why agency theory dominates the field and argues that theoretical diversification requires investment in richer data rather than simply broader lens selection. Second, it demonstrates that standard governance variables function as bundled proxies whose effects are contingent on organizational form, regulatory status, and stakeholder structure, and proposes simultaneous equations modeling to capture the feedback loops between financial performance and social outreach that single-equation designs cannot estimate. Third, it identifies informal and relational governance mechanisms, trust-based networks, board members’ social capital, and stakeholder embeddedness as theoretically central but empirically absent, and proposes longitudinal and mixed-method designs to address this blind spot. Together, these contributions reframe the research agenda on MFI governance and call for a redefinition of effective governance in hybrid, mission-driven organizations.
2026
Cardillo, G., Cavallo, A., Torluccio, G. (2026). Corporate governance in microfinance institutions: A systematic review of theoretical perspectives, methodological approaches, and empirical evidence. WORLD DEVELOPMENT, 206, 107455-107455 [10.1016/j.worlddev.2026.107455].
Cardillo, Giovanni; Cavallo, Alessandra; Torluccio, Giuseppe
File in questo prodotto:
Eventuali allegati, non sono esposti

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11585/1065511
 Attenzione

Attenzione! I dati visualizzati non sono stati sottoposti a validazione da parte dell'ateneo

Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus ND
  • ???jsp.display-item.citation.isi??? ND
  • OpenAlex ND
social impact