CORPORATE GOVERNANCE AND THE FINANCIAL PERFORMANCE OF QUOTED CEMENT COMPANIES IN NIGERIA
CORPORATE GOVERNANCE AND THE FINANCIAL PERFORMANCE OF QUOTED CEMENT COMPANIES IN NIGERIA
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Date
2012-06
Authors
Mohammed, Aliyu
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Abstract
Abstract
Despite the volume of empirical works, there is no consensus on the impact of corporate
governance on firm performance generally. This lack of consensus has produced a variety of
ideas on how Corporate governance influences firm performance. This study examine the
relationship between five corporate governance mechanisms (board size, board composition,
composition of audit committee, managerial shareholding and institutional shareholding) and
three firm performance measures- dividend per share, (DPS), return on capital employed,
(ROCE), and net asset per share, (NAPS), of a sample of four listed cement firms in Nigerian,
between 2004 and 2010.Only secondary data is used in the study. Multiple Regressions of OLS is
used as a tool of estimation. The results provide evidence of a positive association between
performance variable and corporate governance surrogate of Managerial shareholding and
institutional shareholding whereas, board size, board composition and composition of audit
committee have significant negative relationship with the financial performance of the sampled
firms. Consequently, the study recommends, among others, that Boards should comprise of a mix
of executive and non-executive directors majority of who should be non-executive directors.
Also, board size should composed 5-10 members relative to the scale and complexity of the
firm’s operations without compromising independence, compatibility, integrity and availability
of members to attend meetings.
Description
Being an M.Sc. Thesis submitted to the Department of
Accounting, Ahmadu Bello University, Zaria, in partial
fulfillment of the requirements for the award of Master of
Sciences (M.Sc.) Degree in Accounting and Finance