Corporate Governance Attributes and Financial Performance of Listed Industrial Goods Companies in Nigeria

Abstract

Corporate governance is the system by which the affairs of the companies are directed and controlled by those charged with the responsibility. The purpose of this study is to investigate the relationship between corporate governance attributes and the financial performance of listed industrial goods companies in Nigeria. The methodology adopted in this study was an ex -post facto research design. Secondary data from eleven (11) listed industrial goods companies in Nigeria for the period of eleven (11) years (2009-2019) was obtained based on the convenience sampling method. The statistical tools used were multiple regression analysis and Pearson’s product-moment correlation aided by the statistical package for social science (SPSS) version 22. The finding showed that corporate governance had a significant positive relationship with financial performance. Likewise, the board size, board composition and board member competence have a positive relationship with net profit margin. It was concluded that corporate governance attributes influence the financial performance of listed industrial goods companies in Nigeria. It was recommended among others that external auditors should be mandated to issue certificates of compliance with the code of corporate governance for public companies as it is obtainable in some countries like India. Likewise, Appraisal tools for regular monitoring of boards of directors should be developed to help create credibility in corporations in Nigeria. Competent outside directors with requisite experience should be appointed to the board at all times necessary.