The Principles of the Corporate Governance in Banks and Legislation of Republic of Serbia

Abstract

Complex relations, a frequent separation of ownership, management, and control functions in banks, as well as turbulent and changeable market conditions make responsible, fair, and transparent corporate governance mechanisms extremely important for these financial institutions. "The culture" of the corporate governance is incorporated into the banking sector of Republic of Serbia and it is based on the national legislation and international governance standards. The aim of the research is to analyze the level of the implementation of international principles of corporate governance in the Serbian banking sector and to assess the adequacy and strength of the national legal and regulatory framework to enable and support such an act. The descriptive method, an analysis and synthesis technique, as well as the analysis of the content of laws, reports, and available national and foreign literature in the field of corporate governance, were used for the preparation of this paper. The result of the research implies the confirmed assumption that the legal and regulatory framework of corporate governance in the banking sector of Republic of Serbia makes the implementation of the international principles of corporate governance possible and sufficiently supports it.