Ownership Structure and Financial Performance: Evidence from Listed Insurance Companies in Nigeria (Published)
This study investigated ownership structure and financial performance of listed insurance companies in Nigeria. It specifically examined how board diversity, board size, and directors’ shareholding affect return on capital employed of listed insurance companies in Nigeria. An ex-post facto research design was used in the study. Only ten (10) listed insurance businesses in Nigeria were chosen as the sample size, out of the nineteen (19) listed insurance firms in Nigeria that are listed on the Nigerian Exchange Group. The annual reports and accounts of the chosen companies served as the secondary source of the data, which was then subjected to multiple regression analysis and descriptive statistics. The findings showed that while directors’ shareholdings had no discernible effect on return on capital employed of Nigerian listed insurance businesses, board diversity and size had a substantial effect. The study concluded that board diversity and board size served as good predictors of return on capital employed of Nigerian listed insurance businesses. As a result, the study recommended that Nigerian listed insurance firms should emphasize and improve board diversity with regard to gender, as a diverse board promotes more creative thinking, more viewpoints, and better decision-making, all of which raise return on capital employed, while also focusing on maximizing the size of their boards by making sure that there are enough directors to strike a balance between representation and efficiency.
Keywords: Board size, Financial Performance, board diversity, directors’ shareholding, ownership structure and return on capital employed
Board Diversity as Moderator on Firm Characteristics and Financial Performance of Listed Conglomerate Companies in Nigeria (Published)
Financial performance of companies has attracted a lot of attention globally from financial experts and management of firms as a result of 2008 global financial crisis and the failure of major companies. Prior studies on the effect of firm characteristics on financial performance have reported mixed and contradictory results suggesting the existence of certain factors that have not been factored in modeling the relationship. It is against this backdrop that this study examined the effects of firm characteristics on financial performance of listed conglomerate firms in Nigeria in the presence of board diversity. The population of the study consists of six (6) listed conglomerate firms in Nigeria as at 31st December 2017. The six (6) firms were selected to form the sample of the study for the period of eleven years (2007-2017). The census sampling technique was adopted for the study. Secondary data was extracted from the annual report and accounts of the sampled companies A multiple regression analysis was used to test the null hypotheses of the study. The Hausman test indicated random effect model as the appropriate model for the study. The results of study show that leverage has negative and significant effect on return on asset, while firm size and operating expense revealed an insignificant positive effect on return on asset. The sales growth shows a negative and insignificant effect on the return on asset. For model two, it also documented that foreign director positively and significantly moderates the relationship between leverage and sales growth to financial performance of the listed conglomerate firms in Nigeria. It is recommended among others that the management of conglomerate firms in Nigeria should make it mandatory to have an average of 32% of their board members as foreign directors. Also reduce their debt structure to avoid high cost of operation
Keywords: Financial Performance, Nigeria, board diversity, conglomerate companies, firm characteristics