Effect of Corporate Governance on Financials of manufacturing companies in Nigeria
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Date
2016-12
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Volume Title
Publisher
Department of Business Administration, Ibrahim Babangida University, LAPAI
Abstract
The nature and extent of accountability to people who have pulled their resources together to invest in a business and the mechanism that try to decrease the principal agent problem is the subject matter of corporate governance. Corporate governance builds credibility, assures transparency to maintain accurate disclosure of facts and figures and brings about corporate accountability that result to improved overall performance of the firm. This study examined the effect of corporate governance mechanism on firm performance and other key financials using manufacturing firms in Nigeria as a case study. The study was for a period of eleven (11) years from 2004-2014. The study obtained data from library of Securities and Exchange Commission (SEC) and the case study companies’ websites. A total of 10 (ten) manufacturing firms were selected for the study. In analyzing data collected, the study took advantage of both descriptive and inferential statistics tools. The study used panel data regression technique with a choice between fixed effect model (FEM) and Random effect model (REM) i. e (Error Component Model) estimation technique using Hausman test. The result of the study showed that the corporate governance mechanism have significant influence on firm’s financials at 5% level of significance with R2 = 0.3583, 0.4062, 0.5308, 0.7419 and 0.3425 respectively and p value = 0.000, 0.001, 0.022, 0.000 and 0.000 respectively. The study therefore recommended that the necessary institution and legal system to enforce compliance must be put in place for good corporate governance to have a meaningful impact in Nigeria.
Description
Keywords
Corporate Goverance, company financials, performance, owners' Equity, company assets, manufacturing companies
Citation
Kasum, A. S., Fafeyiwa, O. O., Nassar, M. L., & Salman, R. T. (2016). Effect of Corporate Governance on Financials of Manufacturing Companies in Nigeria. LAPAI Journal of Management Science, 7(1), 80-96.