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)
Enterprise Risk Management and Profitability of Insurance Companies in Nigeria (Published)
Nigeria’s insurance industry, despite contributing less than 1% to Nigeria’s GDP, is considered crucial to the economy as it controls large sums of money and protects businesses from diverse risks. However, concerned about business failures in the insurance industry, the National Insurance Commission in 2012, mandated the adoption of Enterprise Risk Management (ERM) by all insurance businesses in Nigeria to address this issue and to deter future business failures. This research work studied the effect of ERM on the profitability of Nigerian insurance businesses over a 10-year period, encompassing the two years prior to, and eight years following the introduction of ERM. ERM is studied from two perspectives: ERM adoption and ERM implementation. Profitability, the dependent variable was measured by Return on Assets while ERM adoption was measured using Chief Risk Officer (CRO) and Board Risk Committee Composition (BRCC. Enterprise Risk Management Index (ERMI) measured ERM implementation. Firm Size (F.SIZE) represented by Total Assets and Firm Age (F.AGE), represented by total years of operations, served as control variables. Using the expo-facto research design and the census sampling technique, relevant secondary data about all 37 insurance companies that were in operation during the study period (2010 – 2019) was collected from published financial statements and the regulator’s reports. The multiple regression analysis revealed that while CRO and BRCC contributed positively to ROA but not at a statistically significant level, ERMI had a negative effect on ROA. The research confirms that ERM adoption only is not sufficient to influence profitability. For better results from ERM, an industry-wide review of implementation practices by NAICOM is recommended.
Keywords: board risk committee composition (BRCC), chief risk officer (CRO), enterprise risk management (ERM), return on assets (ROA)
Current Liabilities and Financial Performance of Healthcare Firms in Nigeria (Published)
The study evaluated the relationship between current liabilities and financial performance of healthcare firms in Nigeria. The specific objectives of the study are to assess the effect of Trade Payables, Current Tax Liabilities and Short-Term Borrowings on Return on Assets of Healthcare firms in Nigeria. Ex post facto research design was adopted. Data were collected from annual reports and accounts of sampled firms within the industry to test the null hypotheses that selected current liabilities do not affect return on assets significantly. Correlational analysis was the tool of analysis using panel data set covering Fifty (50) observations from Five (5) firms in the Healthcare sector. The findings revealed that Trade Payables (TP) have weak but significant positive relationship with Return on Assets of Healthcare firms in Nigeria with a correlation coefficient of 0.524514 and a p-value of 0.0001. Current Tax Liabilities have weak but significant positive relationship with Return on Assets of Healthcare firms in Nigeria with a correlation coefficient of 0.539686 and a p-value of 0.0001. Short-Term Borrowings have weak but significant positive association with Return on Assets of Healthcare firms in Nigeria with a correlation coefficient of 0.538232 and a p-value of 0.0001. The implication of the findings is that current liabilities such as trade payables, current tax liabilities and short-term borrowings are significant positive determinants of financial performance of healthcare firms in Nigeria. The study therefore concluded that while the observed relationships were statistically significant, the weak correlations suggest that other factors not examined in this study may have stronger association with return on assets of healthcare firms. The study recommends that effective management of trade payables and current tax liabilities is essential for healthcare firms to successfully navigate the tedious regulatory requirements and enhance financial performance. Furthermore, strategic utilization of short-term borrowings would provide healthcare firms with the necessary financial flexibility to support growth initiatives and address short-term funding needs.
Keywords: Current liabilities, Financial Performance, Nigeria, current tax liabilities, healthcare firms, return on assets (ROA), short-term borrowings, trade payables
Effect of Enterprise Risk Management on the Profitability of Insurance Companies in Nigeria (Published)
Nigeria’s insurance industry, despite contributing less than 1% to Nigeria’s GDP, is considered crucial to the economy as it controls large sums of money and protects businesses from diverse risks. However, concerned about business failures in the insurance industry, the National Insurance Commission in 2012, mandated the adoption of Enterprise Risk Management (ERM) by all insurance businesses in Nigeria to address this issue and to deter future business failures. This research work studied the effect of ERM on the profitability of Nigerian insurance businesses over a 10-year period, encompassing the two years prior to, and eight years following the introduction of ERM. ERM is studied from two perspectives: ERM adoption and ERM implementation. Profitability, the dependent variable was measured by Return on Assets while ERM adoption was measured using Chief Risk Officer (CRO) and Board Risk Committee Composition (BRCC. Enterprise Risk Management Index (ERMI) measured ERM implementation. Firm Size (F. SIZE) represented by Total Assets and Firm Age (F.AGE), represented by total years of operations, served as control variables. Using the expo-facto research design and the census sampling technique, relevant secondary data about all 37 insurance companies that were in operation during the study period (2010 – 2019) was collected from published financial statements and the regulator’s reports. The multiple regression analysis revealed that while CRO and BRCC contributed positively to ROA but not at a statistically significant level, ERMI had a negative effect on ROA. The research confirms that ERM adoption only is not sufficient to influence profitability. For better results from ERM, an industry-wide review of implementation practices by NAICOM is recommended.
Keywords: board risk committee composition (BRCC), chief risk officer (CRO), enterprise risk management (ERM), return on assets (ROA)