Corporate Governance and Social Responsibility Expenditure of Oil and Gas Firms in Nigeria (Published)
This study investigated the relationship between corporate governance practices and corporate social responsibility expenditure in the oil and gas sector in Nigeria. The research design is ex-post facto, analyzing secondary data from annual reports of selected oil and gas firms listed on the Nigerian Exchange Group. Utilizing data from 2012 to 2023, the research focused on board characteristics such as board size, independence, and meeting frequency to understand their impact on Corporate Social Responsibility (CSR) expenditures. Employing a Spearman Rank-Order Covariance Analysis, the study revealed that board size has a very weak and statistically non-significant relationship with CSR expenditures. In contrast, board independence shows a significant negative relationship. The frequency of board meetings has a weak but statistically significant positive relationship with CSR expenditures. The implication of the findings is that larger boards do not necessarily lead to higher CSR expenditures and that whereas independent boards are associated with lower CSR expenditures, more frequent board meetings are linked to higher CSR expenditures. The study therefore concluded that it is more beneficial for firms to focus on optimizing board effectiveness rather than merely increasing board size or meeting frequency. The study recommends that oil and gas firms in Nigeria should enhance board independence to improve cost efficiency in CSR activities and ensure that board meetings focus more on strategic CSR planning rather than merely increasing the number of meetings. These insights not only elucidate the developments in Nigeria in governance and CSR but also draws essential recommendation for corporate governance in the country’s oil and gas sector.
Keywords: Corporate Governance Practices, Nigeria, corporate social responsibility expenditure, oil and gas sector