CORPORATE INTEGRITY AND ORGANISATIONAL EFFECTIVENSS: EMPIRICAL EVIDENCE FROM BANKS IN NIGERIA

Abstract

The increasing trend of frauds, financial scandals, bankruptcies and other related unethical practices have spurred a critical evaluation of the issue of corporate integrity in Nigeria Banking Industry. The degree to which corporate integrity has effects on performance of firms remains unclear because of the predominant theoretical perspective in explaining the positive implications of corporate integrity on orgnaisational performance. Thus, the objective of this study is to evaluate the effect of corporate integrity on organisational performance, with specific reference to banks in Nigeria. The study adopted survey research design. The study population comprised 2,723 knowledge workers of quoted banks in Nigeria. Purposive sampling technique was used to select 337 respondents from the population. The research instrument was validated using content validity test, and the Cronbach Alpha was used to test the internal consistency of the research instrument. Two hypotheses were tested using the inferential statistics (regression analysis). The first hypothesis revealed that procedure compliance systems (internal control mechanism) have effect on organisational effectiveness of banks in Nigeria. The second hypothesis revealed that organisational culture has significant influence on organisational effectiveness of banks in Nigeria. The study recommended among others that banks should formulate and communicate well-thought out ethical and integrity policies that encourage transparency to employees with clearly stated consequences in the case of non-compliance. Also, regulatory agencies should as a matter of urgency evaluate each company in the banking industry with respect to their internal control procedures.