Corporate Risk Management Disclosures and Financial Performance of Listed Deposit Money Banks in Nigeria

Abstract

The relationship between corporate risk management disclosures and the financial performance of Nigerian listed deposit money banks was empirically examined in this study. The study is important because it shows how much corporate risk management disclosures affect the performance of banks. Corporate risk management disclosures (CRMDs) and financial performance were found to be correlated through the use of CRMD key proxy variables in the study. These variables included Financial Risk Management Disclosure (FRMD), Strategic Risk Management Disclosure (SRMD), Operational Risk Management Disclosure (ORMD), and Technological Risk Management Disclosure (TRMD). Return on equity (ROE) was used as a proxy for financial performance. The study was guided by four hypotheses, and the panel least squares regression model was utilized to perform a statistical test of the parameter estimates. Ex Post Facto design was employed in the study's analysis. The Nigerian Exchange Group (NGX) Factbook, published annual financial reports, and accounts of listed deposit money banks in Nigeria from 2015 to 2022 provided the secondary data for the study. Overall, the results showed a positive and significant relationship between the financial performance of listed deposit money banks and the Financial Risk Management Disclosure (FRMD), Strategic Risk Management Disclosure (SRMD), Operational Risk Management Disclosure (ORMD), and Technological Risk Management Disclosure (TRMD) have a positive and significant relationship with the financial performance of Nigerian listed deposit money bank sat 1–5% significant level of. The study comes to the conclusion that corporate risk management disclosures protect Nigerian banks' bottom lines. Since corporate risk management affects banks' performance in Nigeria, the study recommended that banks reveal more information about financial risk management, strategic risk management, operational risk management, and technological risk management in their annual reports for the consumption of financial statement users.