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
Banking Regulation and Financial Performance of Selected National Microfinance Banks in Nigeria (Published)
This study investigates the impact of banking regulation on the financial performance of selected National Microfinance Banks in Nigeria. Specifically, the study examines the effect of Minimum Capital Requirements and Prudential Ratios prescribed by the Central Bank of Nigeria on the financial performance of National Microfinance Banks, measured by Return on Equity. An ex-post facto research design was adopted, relying on secondary data obtained from the annual reports of the seven licensed National Microfinance Banks in Nigeria and Central Bank regulatory publications over a ten-year period (2015–2024). The data were analysed using Multivariate Analysis of Variance (MANOVA) to capture the simultaneous effects of regulatory variables on financial performance indicators. The empirical findings reveal that Minimum Capital Requirements and Prudential Ratios exert a statistically significant influence on the financial performance of National Microfinance Banks in Nigeria. Specifically, higher capital requirements and compliance with prudential standards are associated with improved financial performance, suggesting that regulatory measures contribute positively to institutional stability and profitability. The interaction effect between these regulatory variables further indicates that their combined influence plays a critical role in shaping performance outcomes. Based on these findings, the study recommends that regulators should sustain effective enforcement of capital and prudential regulations while ensuring sufficient flexibility to accommodate the unique operational realities of microfinance banks. Additionally, National Microfinance Banks should strengthen internal capital management and risk-control mechanisms to optimise returns and ensure long-term financial sustainability.
Keywords: Financial Performance, minimum capital requirements, prudential ratios and returns on equity (ROE)
Intellectual Capital and Financial Performance of Listed Manufacturing Companies in Nigeria: The Moderating Role of Board Financial Expertise (Published)
The main objective of this study was to ascertain the effect of intellectual capital on financial performance of listed manufacturing companies in Nigeria; while examining the moderating role of board financial expertise. The research design adopted for this study was expost facto and secondary data were employed. The sample size of 45 listed manufacturing companies were purposively selected from the population of 52. Panel regression anlaysis was used to analyse the data sets and the statistical package employed was STATA 17. The findings of the study revealed that human capital (coef. 0.056; p-value = 0.000) has significant and positive effect on earnings per share; relational capital (coef. 0.008; p-= 0.442) has nonsignificant effect on earnings per share; Structural capital (coef. 0.012; p-=0.709) has nonsignificant effect on earnings per share; board financial expertise significantly moderates the relationship between human capital and financial performance of listed manufacturing companies in Nigeria. Thus, it was concluded that intellectual capital significantly affects financial performance with board financial expertise strengthening this effect. Based on the findings of this study, it was recommended, amongst others, that management of listed manufacturing companies in Nigeria should adopt a more deliberate and strategic approach to human capital development. Also, these firms should streamline their internal processes, eliminate bureaucratic inefficiencies, and prioritize flexible, innovation-driven systems that would directly contribute to value creation.
Keywords: : Human Capital, Earnings per share, Financial Performance, Intellectual Capital, Relational capital, structural capital
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
Audit Committee Attributes and Earnings Management: Evidence from Quoted Non-Financial Companies in Nigeria (Published)
This study examined effect of audit committee attributes and earnings management of quoted non-financial companies in Nigeria. The objectives were to find out; the extent audit committee size impacts on return on equity of selected quoted non-financial companies in Nigeria; impact on the number of meeting of audit committee on return on equity of selected quoted non-financial companies in Nigeria; and impact of audit committee fees on return on equity of selected quoted non-financial companies in Nigeria. Ex-post facto research design was adopted. Data were collected from Cadbury Nigeria Plc, Cussons PZ, Dangote Plc, Nigerian Breweries Plc and Guinness Nigeria Plc covering the period 2013 to 2023. Panel least square regression analysis was used for data estimation since the data set involves a cross sectional time series. Based on empirical analysis, the study found that audit committee size has positive but no significant impact on return on equity of selected quoted non-financial companies in Nigeria. It was also observed that number of meeting of audit committee has negative and no significant impact on return on equity of selected quoted non-financial companies in Nigeria. Result also revealed that Audit committee remuneration has negative and no significant impact on return on equity of selected quoted non-financial companies in Nigeria. The study concluded that audit committee attributes have no influence on earnings management of non-financial quoted companies in Nigeria. Based on the findings, it was recommended that management of quoted companies should ensure that audit committee meets regularly to ensure better audit quality reporting.
Keywords: Audit Committee, Earnings Management, Financial Performance, Return on Equity, audit committee meetings, audit committee remuneration, audit committee size
Corporate Governance and Financial Performance of Some Selected Commercial Banks in Nigeria (Published)
This paper investigates the effects of corporate governance mechanisms on selected Nigerian banks’ financial performance from 2018 to 2024, focusing on the impact of board structure, audit committee effectiveness, risk management practices, and governance disclosure on profitability, asset quality, and credit risk management. A mixed-methods research design is adopted for this study, complementing quantitative analysis of financial statements and governance reports with insights from regulatory filings and corporate disclosures. Results show that all governance mechanisms are significant, yet distinct, drivers of financial performance, with risk management practices emerging as the most crucial determinant. Boards with diverse expertise, combined with active audit committees, robust risk frameworks, and transparent reporting by firms, go hand in hand with profitability and reduction of non-performing loans. Based on these findings, this study supports theoretical hypotheses within Agency, Stakeholder, Resource-Dependence Theories while extending the previous literature on the role of board diversity, qualitative audit committee engagement, and disclosure as a source of strategic value. This suggests an integrated approach to governance as an important lesson in teasing out how to prosper in Nigeria’s sometimes hostile banking environment, providing lessons that will be useful in practice for bank management seeking to build stronger institutional performance and resilience, regulators, and other policy actors.
Keywords: Bank Profitability, Board Structure, Corporate Governance, Financial Performance, Nigerian Banks, Risk Management, audit committee effectiveness, governance disclosure
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
Financial Risk Management and Bank Performance: An Evidence of Selected Nigerian Deposit Money Banks (Published)
The issue of financial risk management has been a burning issue throughout the banking industry in Nigeria especially in the wake of global financial crisis and the ensuing regulatory changes. Nigerian deposit money banks (NDMBs) face a number of financial risks which can impact their capacity to earn sustainable returns and financial sustainability to a large extent. It is thus necessary to understand the impact of these risks on financial performance in a bid to supervise banks and make managerial decisions in Nigeria. The paper explores the effect of financial risk on financial performance in NDMBs on an expo facto research design. The data were collected using secondary sources in the years between 2010 and 2022 and on selected NDMBs. The study utilised stratified sampling to identify the diversity of the NDMBs as 20 banks were purposively identified to participate in the study. The year 2010 was taken as the base year due to the fact that it was the year when the world came out of a global economic crisis and new risk and governance policies were implemented by the bank management and regulators. The information regarding the financial and bank performance was obtained through the Central Bank of Nigeria (CBN) reports and Annual Financial reports of the chosen banks. The data obtained was analysed with the help of proper descriptive and panel least square regression analysis methods. The results exhibited credit risks (CRR), cost-income ratio (CIR), total regulatory capital (TRC), and bank size (SIZE) as factors influencing financial performance through both return on assets (ROA) and return on equity (ROE). CRR showed a negative coefficient value of 0.0002 and probability of 0.0419, LQR has a negative coefficient value of 0.0594 which is statistically significant (p-value = 0.0498), CIR (coefficient = -0.0281 and probability = 0.0106), TRC with a positive coefficient value of 0.0358 on the level of ROA which is statistically significant (p-value = 0.0457), and SIZE showed a coefficient value of 0.0088 which is statistically significant (p-value = 0.0210). While CRR negatively and significantly influenced ROE with a negative coefficient value of 0.0039 and probability of 0.0254, LQR had a positive coefficient value of 0.0867 on ROE which is statistically significant (p-value = 0.0317), CIR (coefficient = 0.0785 and probability = 0.0472), SIZE is significantly influenced the returns with coefficient value of 0.097 and probability of 0.0016. The study concludes that financial risk management significantly influences financial performance of NDMBs. The study recommends that banks must observe strict compliance with regulatory positions on lending and ensure that their credit risk management is tailored towards generating sufficient earnings that will improve financial performance. Also, bank management must endeavor to have a robust risk management strategy that incorporates global best practices so as to improve their financial performance and be better prepared for economic challenges.
Keywords: Financial Performance, Nigerian deposit money banks, financial risk management
Internet Financial Reporting and Corporate Governance Mechanisms: Empirical Evidence on the Financial Performance of Firms Listed on the Nigeria Exchange Group (Published)
Internet Financial Reporting (IFR) has become an important tool in increasing transparency, accountability and timely reporting of financial information and corporate governance mechanisms (CGMs) is important in the efforts of harmonising the actions of the managers with the interests of the shareholders. Though IFR and governance reforms are becoming increasingly popular in Nigeria, very little empirical information is available regarding the joint impact of these two on the performance of the quoted companies. The research design was longitudinal research with the basis of secondary data. There were 151 quoted companies on the Nigeria Exchange Group (NGX) that comprised 47 financial and 104 non-financial companies and this was over the period 2012 to 2023. Out of this population, 56 sampled companies (45 non-financial and 11 financial companies) were sampled purposively on information available and adhering to International Financial Reporting Standards (IFRS). The year 2012 was selected as a base year since this was the year when quoted companies in Nigeria adopted the IFRS. The published and audited corporate filings and financial statements were used to source data. Measurements of the IFR, CGMs, and financial performance (return on assets, return on equity, and return on capital employed), and control variables were used as the variables. The analysis of data was performed with the help of descriptive statistics and generalised method of moment (GMM) estimation technique. The results found that IFR and CGMs had positive influence on financial performance. To be more precise, the joint IFR and CGMs yielded a value of coefficient of 35.854 on the return on assets, 43.085 on the return on equity and 37.832 on the return on capital employed. The three effects were statistically significant as their p-values were 0.428, 0.164 and 0.341 respectively, which means that better internet-based financial disclosure and effective mechanisms of governance are related to better financial performance of quoted companies in Nigeria. The paper concludes that IFR and CGMs are a significant improvement in the financial performance of the quoted companies in Nigeria through a better use of transparency and accountability, as well as stakeholder engagement. The recommendation that the quoted companies in Nigeria should still use IFR as a strategic tool of enhancing transparency and strengthening stakeholder relationship by making regular and convenient online disclosures of their financial results is recommended. Boards also ought to review unnecessary or ineffective meetings and channel them into strategy purposes, especially those concerning the quality of disclosure and performance improvement. In addition, the use of IFR by quoted companies should be motivated and as needed required by the regulatory bodies like the Financial Reporting Council of Nigeria (FRCN) and the Securities and Exchange Commission (SEC) so that the practise of disclosure is unified, and investor confidence is increased as a result, and the overall performance of the corporate sector is positively impacted.
Keywords: Corporate Governance Mechanisms, Financial Performance, Nigerian quoted companies, internet financial reporting