Impact of Corporate Governance on the Financial Performance of Deposit Money Banks in Nigeria (Published)
The study evaluated the impact of corporate governance on the financial performance of Deposit Money banks in Nigeria. The study was guided by four research questions and four research hypotheses. Also, the study covered corporate governance such as board size, financial reporting quality, board independence, and pay performance sensitivity as well as return on asset (ROA) as metrics for profitability of the commercial banks. In addition, an ex-post-facto research design was employed to carry out this investigation, with annual report of the banks used as secondary data for the study. The study’s population included all commercial banks in Nigeria. The study’s sample included thirteen (13) deposit money banks in Nigeria listed in the Nigerian Exchange Group and annual report were collected from 2014 to 2023. The unit root test and descriptive statistics were used to analyse the data collected, while the stated hypotheses were evaluated using linear regression statistical methods. Following the analysis, the following findings were obtained: Board size had significant influence on the Return of Assets of Deposit Money banks in Nigeria. Also, there was significant impact of financial reporting quality on the Return of Assets of Deposit Money banks in Nigeria. Furthermore, board independence had significant influence on the Return of Assets of Deposit Money banks in Nigeria. In addition, pay performance sensitivity had significant influence on the Return of Assets of Deposit Money banks in Nigeria. The study concluded that corporate governance structures play a critical role in determining the financial performance of Nigerian DMBs. The findings contribute to the growing body of literature emphasizing that effective governance not only enhances accountability and transparency but also serves as a catalyst for improved financial outcomes. As such, regulatory authorities, bank management, and policymakers must continuously strengthen governance frameworks to promote financial stability and investor confidence within the banking sector.
Keywords: Board independence, Board size, Corporate Governance, Financial Performance, return on assets (ROA)
Corporate Board Attributes and Financial Performance of Quoted ICT Companies in Nigeria (Published)
Financial performance variations experienced by ICT companies in Nigeria have been linked to corporate governance inefficiencies due to the failure to harness board attributes towards the maximization of asset efficiency and profitability. Although the information and communication technology sector is critical to economic development in Nigeria, literature on how corporate board attributes can help improve the financial performance of companies operating in this environment is scarce. This paper, therefore, evaluates the effect of corporate board attributes on the financial performance of quoted ICT companies in Nigeria. Specifically, this study evaluates the impact of board independence, board gender diversity, and board size on financial performance represented by return on assets. A quantitative research design based on the ex-post facto method is adopted, with the target population being all the ten ICT companies operating in Nigeria and listed on the NGX through census technique. Data are obtained from annual reports and corporate governance reports of sampled firms spanning eight years from 2017 to 2024. Panel data analysis is carried out using a fixed-effect regression model which was selected through the Hausman specification test. Data analyses are conducted using Stata software, version 17, with hypothesis testing done at 5 per cent probability level. Empirical results show that board independence has a negative but statistically significant effect on return on assets (p= 0.0015), implying that too much board independence incurs the cost of monitoring and induces decision lags resulting in poor utilization of assets. Board gender diversity has a positive, albeit, statistically insignificant effect on return on assets (p=0.4231), showing that current levels of board gender diversity may be too low to impact financial performance significantly. Board size has a statistically significant positive effect on return on assets (p=0.0489) meaning that moderate-sized boards allow for better access to expertise and other resources that boost financial performance. The control variable, firm size has a statistically significant positive effect on return on assets (p=0.0173). In conclusion, the study reveals that corporate board attributes play an influential role in determining financial performance in Nigeria. The implications of these findings are discussed and recommendations proposed.
Keywords: Board independence, Board size, Financial Performance, board gender diversity, corporate board attributes
Corporate Governance and Financial Performance of Deposit Money Banks in Nigeria (Published)
This study examined the effect of corporate governance on the financial sustainability of deposit money banks in Nigeria, focusing on board size, board composition, and audit committee effectiveness. A descriptive survey research design was adopted, with primary data collected from 153 employees across three purposively selected commercial banks in Abuja, Nigeria. Data were analyzed using descriptive statistics, Pearson correlation, and multiple regression analyses. Results indicate that board size (β = 0.342, p = 0.001), board composition (β = 0.371, p < 0.001), and audit committee effectiveness (β = 0.388, p < 0.001) all have significant positive effects on financial sustainability. Audit committee effectiveness exhibited the strongest influence on sustainability outcomes. The study concludes that robust corporate governance practices are essential for enhancing the long-term financial sustainability of banks. Recommendations include strengthening board oversight, promoting director independence, and enhancing audit committee effectiveness to ensure accountability and sustainable growth. These findings provide actionable insights for policymakers, regulators, and banking executives seeking to optimize governance and sustain financial performance.
Keywords: Board Composition, Board size, Corporate Governance, Deposit Money Banks, Financial Sustainability, Nigeria, audit committee effectiveness, banking performance
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
Corporate Governance Mechanisms and Financial Performance of Listed Insurance Firms in Nigeria (Published)
This study examines the effect of corporate governance mechanisms on the financial performance of listed insurance firms in Nigeria. Focusing on board size, board independence, board gender diversity, and audit committee independence, the study uses audited financial statements from all 17 listed insurance companies with complete data from 2020 to 2024. Employing an ex-post facto research design and panel data analysis, the study applies descriptive statistics, correlation analysis, and Ordinary Least Squares (OLS) regression to assess the relationships between governance characteristics and Return on Assets (ROA). The findings reveal that board gender diversity and audit committee independence significantly enhance ROA, while board size and board independence do not have a statistically significant effect. The study highlights the importance of board composition quality, particularly gender diversity and independent audit oversight, in promoting firm performance. These results provide practical insights for regulators, investors, and corporate boards in optimizing governance structures for sustainable growth.
Keywords: Board independence, Board size, Corporate Governance, Financial Performance, audit committee independence, board gender diversity
Corporate Governance Practices and Performance of Deposit Money Banks in Nigeria (Published)
Performance of deposit money banks in Nigeria. The specific objective of the study was to critically appraise the relationship between size of board of directors, composition of board members, frequency of board meetings and return on assets of deposit money banks in Nigeria. The data were sourced through secondary sources from annual reports and accounts of sampled deposit money banks in Nigeria. The stated Null Hypotheses were tested through data analysis by using the correlation analysis as analytical tool. The research findings reveal that board size has a positive and strong relationship with return on assets while board composition has a positive but moderately strong association with return on assets. Furthermore, frequency of board meetings has a negative and very weak relationship with return on assets of deposit money banks in Nigeria. The implication of the findings is that increased board size could result in the improvement of financial performance of deposit money banks. The research found that such increase in number of members of the board will generate the desired outcome if it centers on independent nonexecutive directors with wealth of corporate governance experience, sound and profitable contacts, good and relevant education. The negative relationship with frequency of board meetings implies that banks should begin to trim down on number of board meetings as research has found that frequent meetings signal a crisis or distress situation with perceptions of going concern issues and bank failure. The study recommends that new independent non-executive professionals with critical governance and management attributes could be introduced into the board to improve the quality of decisions, earnings and general performance. Frequency of Board Meetings should be reduced to save cost and time while virtual meetings should be called more often than physical meetings as distance is no longer a barrier.
Keywords: Banks’, Board Composition, Board Meetings, Board size, Financial Performance, Nigeria, Return on Assets
Analysis of The Role of Corporate Governance Mechanisms in Shaping the Financial Reporting Practices of MNEs in Nigeria (Published)
This study analysed the role of corporate governance on the quality of financial reporting practices of Multinational Enterprises (MNEs) in Nigeria. The study made use of managerial hegemony theory to establish a theoretical foundation in examining the effect of corporate governance mechanisms in the quality of the financial reporting practices of MNEs in Nigeria. Ex-post facto research design and panel regression were employed by the study. The study extracted data from the audited financial statement of 20 active MNEs in the consumer manufacturing sector listed on Nigeria Exchange Group (NGX). The population forms the sample size using census sampling. Findings revealed that the size of board, board independence, gender diversity and board shareholding did not significantly affect the quality of financial reporting practices of MNEs in Nigeria. Firm size and firm leverage significantly moderate the interaction between corporate governance and the quality of financial reporting practices of MNEs in Nigeria. The study concluded that this finding is a pointer to the fact that the quality of financial reporting of MNEs in Nigeria may be determined by factors other than corporate governance such as the adoption of International Financial Reporting Standard (IFRS), regulations, and Nigerian laws (CAMA 2020). Therefore, the study recommends that MNEs in the consumer sector in Nigeria should strengthen their corporate governance mechanism with the aim of improving the quality of financial reporting of their businesses in the short-run and the confidence of their customers and investors in the long-run.
Keywords: Board size, Corporate Governance, board gender diversity, board independent, board shareholding, financial reporting practices
Moderating Role of Board Size on Debt Capital and Firm Performance of Quoted Industrial Goods Companies in Nigeria (Published)
Financing sources of any corporate organization are a serious determinant of its performance because either equity or debt financing has its cost. The interaction between them has to be evaluated periodically. Against this background, this study establishes the Moderating role of board size on debt capital and the firm performance of industrial goods companies in Nigeria. The population of the study comprises the thirteen industrial goods companies quoted on the Nigeria Exchange Group (NGX). The population was wholly sampled for the study. Debt financing represented by debt-to-total asset was the independent variable, while, firm performance) was measured by return on assets (ROA). The panel data were obtained from the financial statements of the companies from 2012-2021. The study adopts a bi-model approach for clarity of presentation and analysis. The analysis was conducted with the aid of the pooled Ordinary Least Square Multiple Regression method and the result from Model I showed that debt capital has a significant negative effect on the firm performance of the sampled companies. The result from Model II indicated that board size has an insignificant positive moderating effect on debt capital and firm performance. The study recommends that the management of industrial goods companies in Nigeria should keep debt capital at its lowest to improve their performance.
Keywords: Board size, Firm Performance, debt capital, moderating variable and return on asset.
Corporate Governance Characteristics and Firm Value of Deposit Money Banks in Nigeria (Published)
The degree of corporate and market procedures, lack transparency, distortions and poor corporate practices which results in corporate failures and abysmal corporate financial performance negatively influence corporate objectives. Hence, this study investigated the effects of corporate governance mechanism on the value of deposit money banks in Nigeria. The study population consisted of all deposit money banks and Taro Yamene method of sample size determination was applied. The secondary data for the study was from the published financial statements of sampled banks for the period after validity and reliability test of data. The data obtained was tested using univariate, bivariate and multivariate analysis. The result from the multiple regression result disclosed that board independence, board size, ownership structure, gender diversity and board meeting positively and significantly influences the value of deposit money banks in Nigeria. The study concluded that corporate governance attributes positively and significantly affects the value of deposit money banks in Nigeria. The study made several recommendations amongst others that board sizes should be enhanced as this allows for the appropriate combination of directors. A large board increases the chance of directors having appropriate knowledge, skill and networks. The knowledge, skill and networks of directors may increase the financial performance of an organization. Also deposit money banks in Nigeria should have non-executive directors who act as professional advisers to ensure that competition among insiders encourages measures consistent with maximization of shareholder value.
Keywords: Board independence, Board size, Firm Value, Gender diversity
Board Size And Retained Earnings of Deposit Money Banks in Nigeria (Published)
The study examined board size and retained earnings of deposit money banks in Nigeria. The objective of the study was to ascertain the relationship between board size and retained earnings of deposit money banks in Nigeria. The study adopted an ex-post-facto research design, covering the period between 2010 and 2019. Secondary data were extracted from the annual reports and accounts of sampled deposit money banks in Nigeria. Total assets, total deposits, statutory reserves, and number of branches, were the control variables of the study. Multiple regression and covariance analysis were used for data analysis. The covariance analysis revealed that total asset (p-value < 0.05), total deposit (p-value < 0.05), and number of branches (p-value < 0.05) have a strong and positive relationship with retained earnings (80% approx., 78% approx., 64% approx. respectively). Statutory reserve (p-value < 0.05) and board size (p-value < 0.05) have a strong and negative relationship with retained earnings of deposit money banks in Nigeria with the following coefficients Statutory reserve 73% and board size 53% approx. The findings imply that as a total asset, total deposits, and the number of branches are increasing, the banks’ retained earnings also increase significantly and vice versa. On the other hand, as statutory reserve and board size are increasing, banks’ retained earnings decrease significantly. Hence, these variables can be used to predict and make decisions on retained earnings of deposit money banks in Nigeria. The study, therefore, recommends that deposit money banks in Nigeria should keep a small or moderate board size since an increase in board size affects their retained earnings negatively.
Keywords: Board size, Deposit Money Banks, Nigeria, Total Asset, number of branches, retained earnings, statutory reserve, total deposit