Article

Corporate Governance and Financial Performance of Quoted Deposit Money Banks in Nigeria: An empirical investigation

Oct 21, 2021

DOI: https://doi.org/10.31920/1750-4562/2021/v16n3a12

Published in: African Journal of Business and Economic Research

/ Mosab Tabash / Ahmed Abou Samak

This paper studied how firm governance affects the performance of quoted deposit money banks in Nigeria. The paper aimed to ascertain the effects of board size, board composition, and gender diversity after controlling for firm age and firm size on financial performance. The study was predicated on stewardship theory, agency theory, and resource dependency theory. Data was fetched from the financial statements of all quoted deposit money banks. The study utilized a panel regression method to examine the relationship between the predictive and explanatory variables from 2015 to 2019. The study population comprised the 14 banks listed on the Nigerian Stock Exchange as of 31 December 2019. The individual outcomes showed that board size and gender diversity in conjunction with firm age have significant impacts in both directions on the financial performance proxied by return on assets. As can be inferred from the panel random effect test results, it was concluded that corporate governance mechanisms were collectively discovered to have significant relationships with the financial performance in the study, which was confirmed by the p-value (0.01695<0.05). The study recommended, among others, that deposit money banks in Nigeria should ensure that the employment of autonomous executives should not only be based on the supervisory ability of these members, but also on liberated proficient business competence and skills.

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