Effect of Board Diversity On Financial Performance of Information and Communications Technology (Ict) Firms in Nigeria (2016-2020) (Published)
Citation: Nome Ujebe and Nwankwo, John Ndubuisi (2022) Effect of Board Diversity On Financial Performance of Information and Communications Technology (Ict) Firms in Nigeria (2016-2020), Global Journal of Human Resource Management, Vol.10, No.2, pp.12-27
This study examined the Effects of Board Diversity on Financial Performance of Information and Communications (ICT) Firms in Nigeria. The study was prompted by inevitability of board diversity in the large scale organizations like quoted Information and Communications Technology (ICT) firms in Nigeria. Specifically, it focused on determining the effects of board size, board composition, board gender and foreign director on the Financial Performance of Information and Communications (ICT) firms in Nigeria. The study adopted ex-post-facto design using secondary data collected from annual accounts and reports of ICT firms in Nigerian Stock Exchange (NSE) covering seven (7) firms over a period of five years ranging from 2016 to 2020. The selection of 2016 to 2020 was necessitated by the rapid changing ICT business environments which Nigeria is not an exception. In all, there are eight quoted ICT firms in Nigeria but the study focused on the seven quoted ICT firms that have the required data. The ordinary least square panel regression analysis was used for the data analysis applying Generalized Method of Moment (GMM) analysis. E-view version 9 software was used for analysis where necessary. The study found that Board Diversity has mixed effects on financial performance of ICT firms in Nigeria. Specifically, the board size has significant positive effects on financial performance of ICT firms in Nigeria likewise foreign director in board of directors while board composition and board gender have low negative effect on financial performance of ICT firms in Nigeria. Hence, it is safe to conclude that board diversity has mixed effects on financial performance of quoted ICT firms in Nigeria. Although negative effect is insignificant, the positive effect is significant. The study recommended that the firms should increase as much as possible the board size bearing in mind Nigeria corporate governance Code requirement of minimum of five and maximum members based on complexity and scale of operation of the firms. Appointing both gender: male or female into board of directors provided that they are qualified and willing to serve, does not matter. Foreign director in board of directors was found to be positive and contributes significantly to financial performance of the ICT firms in Nigeria possibly by bringing their wealth of knowledge and experiences in the board of directors’ roles to their organizations.
Keywords: Financial Performance, Firms, ICT, board diversity