IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT (IJEFM )

E-ISSN 2545-5966
P-ISSN 2695-1932
VOL. 6 NO. 2 2021

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The Board Structure and Financial Performance of Selected Listed Consumers’ Goods Firms: Evidence from Nigeria.

Alashe, Abdulganiyy Kayode (MSc, MBA, FCA, FCTI), Raheed, Lateef Olayiwola (MSc, MMP, FCPSP, ACA) & Bello, Abass Oyeshola (MSc, FCPSP, ACA)

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Abstract

Despite the available evidence on the nexus between the board structure and financial performance, lacunae still exist on how board structure, operationalised as board gender diversity and executive directors; numerical strength influence financial performance measured using profit after tax margin and profit before tax margin in Nigeria, in the post International Financial Reporting Standards (IFRSs) adoption era. Motivated by these gaps, this paper investigated the influence of the Board Structure on Financial Performance of consumers’ goods firms in Nigeria. To achieve the study’s objective, two objectives were specified and two hypotheses were formulated. Data of secondary nature, which spanned years 2012 to 2019 were collected from fourteen (14) firms in the consumer goods sector using judgmental sampling technique. The data were collected from the annual reports of these firms. The data were econometrically analysed using ordinary least square, highlighting pooled, fixed and random effects. Results revealed that board gender diversity has no significant influence on profit after tax margin of selected listed manufacturing firms (?=-0.5504; p- value>0.05). It was further revealed that executive directors’ numerical strength does not have a significant effect on profit after tax margin of selected listed manufacturing firms (?=-0.3969; p-value>0.05). Based on these findings, the study concluded that board structure has no significant influence of financial performance of listed consumers’ goods firms in Nigeria. The study, therefore, recommended that regulatory bodies should evolve practices by designing robust policies that would address acute female under-representation on the boards of listed consumers’ goods firms in Nigeria

keywords:

Board gender diversity; executive directors’ numerical strength; board structure; profit after tax margin; Nigeria

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