Corporate Governance and Financial Performance of Listed Manufacturing Firms in Nigeria

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Advances in Management


Corporate governance mechanisms play an important role in ensuring corporate performance and wealth maximization of shareholders. Many companies have failed in the past because of inefficient corporate governance mechanisms within the organization which has led to loss of millions in terms of earnings by shareholders and other concerned stakeholders. It is with this that this study investigated the effect of corporate governance mechanism on firms' performance from the perspective of shareholders wealth maximization in Nigeria. This study adopted ex-post facto research design to analyze the annual pooled data from 10 years (2007 - 2016) which were obtained from the annual reports and accounts of the selected companies employing multiple regression technique. The study found that P = (.00; .00; .00) at 5% level of significant for EPS, DPS and MPS respectively, R2 = .720; .819; .731 for EPS, DPS and MPS respectively. Adj R2 = .681; .794; .693 for EPS, DPS and MPS respectively. The study therefore, established that corporate governance variables of interest have significant effect on performance of listed firms in Nigeria. This study recommended that companies should ensure effective and efficient corporate governance mechanisms and most importantly, link directors' financial remuneration to the efficiency of the directors in improving profitability and thereby creating value for shareholders.



Corporate governance mechanisms, Profitability, Shareholders wealth maximization, Financial performance