Journal of Accounting and Financial Management (JAFM )

E-ISSN 2504-8856
P-ISSN 2695-2211
VOL. 10 NO. 10 2024
DOI: 10.56201/jafm.v10.no10.2024.pg225.241


Effect of Corporate Governance on Financial Performance of Listed Commercial Banks in Nigeria

Kehinde Lawal, Lucky Onmonya, Taiye Oyetola


Abstract


Corporate governance has received significant attention among various stakeholders as it is believed that a well-diversified board increases firms performance. This study examined the effect of corporate governance on the financial performance of listed commercial banks in Nigeria from 2012 to 2022. Secondary data on board size, board independence, board meetings, board gender diversity and return on assets were sourced from the various annual reports and accounts of the sampled banks. The data were analysed using descriptive statistics, correlation matrix and the formulated hypotheses were analysed using random effect regression analysis. Findings revealed that board size has a negative and significant effect on the financial performance of listed commercial banks in Nigeria. In addition, board gender diversity has a negative and significant effect on the financial performance of listed commercial banks in Nigeria. Findings also revealed that board independence and meeting has an insignificant effect on financial performance of listed commercial banks in Nigeria. These findings imply that an increase in board size decrease performance. Therefore, the study recommended that Banks are encouraged to adhere to the new CBN corporate governance code by limiting the size of the board to nine since larger board size does not influence financial performance.


keywords:

ROA, Board Size, Board Meeting, Board Gender Diversity, Board Independence


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