Manufacturing Sector In Nigeria Research Articles

Impact of Digitalization on Firm Performance in the Manufacturing Sector: A Case Study of Nigeria

Purpose: The aim of the study was to investigate the impact of digitalization on firm performance in the manufacturing sector: a case study of Nigeria. Methodology: This study adopted a desk methodology. A desk study research design is commonly known as secondary data collection. This is basically collecting data from existing resources preferably because of its low cost advantage as compared to a field research. Our current study looked into already published studies and reports as the data was easily accessed through online journals and libraries. Findings: Digitalization has significantly impacted firm performance in Nigeria's manufacturing sector. It has enhanced operational efficiency, improved decision-making processes, and spurred innovation within firms. By embracing digital transformation, Nigerian manufacturing companies have bolstered their competitiveness and market positioning. Ongoing investment in digital capabilities is crucial for sustaining growth and success in the sector. Unique Contribution to Theory, Practice and Policy: Resource-based view (RBV) theory, technology acceptance model (TAM) & institutional theory may be used to anchor future studies on the impact of digitalization on firm performance in the manufacturing sector: a case study of Nigeria. Nigerian manufacturing firms should prioritize investment in digital infrastructure, talent development, and organizational culture conducive to digital innovation. Policymakers should enact supportive regulatory frameworks and incentives to encourage digitalization adoption among manufacturing firms in Nigeria.

Empirical Evidence from Nigeria on Environmental Health and Occupational Safety at Work

The International Labour Organization (ILO) has developed numerous conventions, protocols, and recommendations on minimum labour standards, with the majority relating to occupational safety and health systems (OSH). However, environmental issues like deforestation, desertification, flooding, erosion, oil spills, and air and water pollution, particularly in Nigeria, pose a threat to the health and safety of the many organizations in developing nations. Using a hybrid of research designs such as survey and content analysis and based on the Risk Society Theory and Sense-making Theory, this paper reviews, environmental health and occupational safety at workplaces in Nigeria. This study aims to identify environmental health and occupational safety issues in Nigeria's manufacturing sector, specifically in the iron and steel and aluminium industry, by examining inaccurate data on male and female workers. Using in-depth interviews with a total of 17 participants, the primary data was gathered from managers and senior staff members of chosen firms in Ajaokuta, Kogi State, and Lagos State, Nigeria. These were Ajaokuta Steel Company Limited (ASCL) and Alumaco Aluminium Manufacturing Co. of Nigeria Ltd., Ikeja, Nigeria. It discovers a high level of occupational health awareness, insufficient funding for safety intelligence initiatives, and a high frequency of workplace dangers. The study also finds that Nigeria was among the signatories in Africa who failed to comply with this directive. It recommends promoting occupational health services, training doctors to recognize work-related diseases, and complying with the ILO's Convention 155. The article also suggests updating laws, conducting education campaigns, investing in training, and holding employers accountable for non-compliance

The Influence of Macroeconomic Variables on Manufacturing Sectors: A Case of Nigeria

This study has examined the influence of macroeconomic variables on manufacturing sectors with a particular reference to Nigerian economy. The objective of the study is to investigate the effects of macroeconomic variables on manufacturing sectors (proxy businesses, productivity sectors and industries) in Nigeria. Econometrics tools were employed to analyse the variables sourced from the Central Bank of Nigeria Statistical bulletin within the period of 1985 up to 2022. Among the pre-test conducted on the variables are unit root test, descriptive statistics and co-integration bound test. Meanwhile, post-diagnosis test conducted include: stability test, heteroskedacity test, and serial correlation test. The findings show that macroeconomic variables have mixed influences on the manufacturing sector in Nigeria. It is, therefore, recommended that the government should effectively stabilise and manage interest rate, exchange rate and inflation rate with a view of creating enabling environment for manufacturing firms and potential investors in Nigeria. The government should intensify the efforts of garnering more foreign earnings by harnessing international trades.

EFFECTS OF EXCHANGE AND INTEREST RATES ON MANUFACTURING SECTOR PERFORMANCE IN NIGERIA: ARCH AND GARCH APPROACH

This study evaluates the effects of exchange, and interest rates on manufacturing sector performance in Nigeria. The data were sourced from the World Bank's World Development Indicators (WDI) and the Statistical Bulletin of the Central Bank of Nigeria (CBN) for the analysis. The unit root test was performed on the formulated model using the Augmented Dickey Fuller (ADF) method. The log of manufacturing sector contribution to GDP (MUFQ), exchange rate (LEXR), inflation rate (LIFR), and bank size (LBKS) were integrated at order zero I(0) while and the log of interest rate spread (LIRS). was stationary at order one I(1), as shown by the Augmented Dickey Fuller unit root test. In order to determine whether there is a long-run relationship between interest rate, exchange rate, and inflation, a bound test was conducted using the Auto-regressive Distributive Lag (ARDL) model. High volatility in exchange and interest rates have a positive effect on manufacturing sector performance, as shown by the results of the Auto-regressive Distributive Lag (ARDL) bound test, and the results from Arch and Garch corroborate these findings. Auto-regressive Distributive Lag (ARDL) results indicated a positive and statistically significant relationship between the exchange rate and the performance of the manufacturing sector over time at 0.05 level. However, bank size revealed a positive but insignificant relationship with manufacturing sector performance in the short-run, while the coefficient of interest rate spread and inflation rate were both negative and significantly influenced manufacturing sector performance in the current year period. The paper concludes that Nigeria's manufacturing sector is strongly correlated with the country's exchange and interest rates. The study recommended amongst others that as a result of too much dependence on oil, the federal government should peg the local currency rate and mandate the deposit money banks through the Central bank of Nigeria (CBN) to maintain a single digit interest rate. This would boost investors’ confidence on the Nigerian economy as well as the financial system while efforts should be taken to diversify the economy to ease the pressure from the local currency.

Bank Credits and Economic Growth

This study examined the effect of bank credit on the growth of the Nigerian economy. The study was specifically meant to assess the impact of bank credit to the agricultural sector on the growth of the Nigerian economy; to determine the effect of bank credit to the manufacturing sector on the growth of the Nigerian economy and lastly to assess the effect of bank credit to the mining and quarrying sector on the growth of the Nigerian economy. To achieve these objectives, the study employed the ex-post facto research approach. Time-series data were collected from the CBN Statistical Bulletins using the desk survey method from 1985 to 2018. The data were analysed using various econometric techniques such as the descriptive statistics test, the Augmented Dickey-Fuller (ADF) unit root test, Correlation matrix, and Autoregressive Distributive Lag (ARDL). Findings from the analyses showed that there was an insignificant short-run effect of bank credit on the growth of the Nigerian economy. It was also revealed that there was a significant long-run effect of bank credit on the growth of the Nigerian economy. Based on these findings, the study recommend the establishment of an agency were all commercial farmers would be registered with responsibilities to interface with banks to ensuring that loans are free from collateral requirements, interest rate charges and loan administration bottlenecks in order to encourage commercial farming and towards enhanced economic growth in Nigeria. Also, policies targeted at reducing the interest rate charged on bank credit to the manufacturing sector in Nigeria should be implemented by the CBN through the conscious subsidy of all bank credit to the manufacturing sector as this is required to trigger productivity and enhance short term economic growth.

Effect of Non - Renewable Energy on Manufacturing Output in Nigeria

The role of energy, especially non-renewable energy in promoting manufacturing sector activities and operations in developing countries like Nigeria cannot be over-emphasized. This paper investigated the effect of non-renewable energy on textile and clothing output as a sub-sector of the manufacturing sector in Nigeria using time series data covering the period 1986 to 2021. Expost -Facto design was employed as a guide. The study used annual time series data on hydro-electricity, petroleum and gas energy respectively as components of non-renewable energy and textile and clothing manufacturing sub-sector output in Nigeria spanning from 1986 to 2022. Data used were obtained from the Central Bank of Nigeria (CBN) Publication and the World Development Indicators (WDI) considered as reliable sources of data for econometric analysis. The ARDL regression technique was used to estimate depicting the relationship between the variables, while the econometric properties of the data were determined using the Phillip-Perron (PP) unit root test and the Bounds cointegration methods. Mean, kurtosis and skewness were employed to describe the data. Results showed among others, that textile and clothing (coefficient, 1.25449; probability value, 0. 000) has significant positive effect on output level. Coal energy consumption (CEC) (coefficient, -6.665467; p, 0.7170), while petroleum energy consumption (PEC) (coefficient, -0.090996; p-value, 0. 6910) had no significant negative effect on textile and clothing output level. Furthermore, gas energy consumption (GEC (coefficient, 19.80158, p, 0.0069) had significant positive effect on textile and clothing output in Nigeria. The Paper concluded that non-renewable energy has no significant effect on textile and clothing output in Nigeria. The study recommended among others, that alternative energy sources, particularly renewable sources should be explored by the federal ministry of petroleum for enhanced economic growth, particularly of textile and clothing output.

Revolutionising Organisational Safety and Health Management in the Nigerian Manufacturing Industry via Active Employee Involvement

The concerns with the increasing rate of preventable accidents occurrences in Nigeria's manufacturing sector required a renewed focus on occupational safety and health (OSH). Specifically, despite the number of interventions and the amount of spending on interventions, the effects have remained minimal. Also, despite the efforts of researchers and their suggestions, little or no impact has been noticed as OSH continues to be inadequate. These problems call for a fresh approach and consultation with the individuals who will be utilising these solutions most directly (the workers) to address these issues at their core. This paper is part of a large mixed-method study designed to explore how to improve the efficacy of OSH in Nigeria. However, this present paper reports part of the initial phase as it examines the perception of blue-collar workers in the Nigerian industry to understand how well the existing measures have satisfied their safety needs from the standpoint of available human resource management practices (HRM practices). Hence, this work uses a cross-sectional research design to gather data from both registered and non-registered workplaces located in cities in three Nigerian states, totalling 633 required participants. A mix of simple random and convenience sampling techniques was applied to select the expected samples. SPSS software version 26 was used to analyse the 641 responses. The blue-collar workers constituted the unit of analysis for this phase. The findings indicated that there are diverse opinions among Nigerian manufacturing blue-collar workers regarding the accessibility and applicability of the HR practices under investigation. Based on the findings, recommendations for improving OSH practices in the manufacturing industry is suggested with the hope of maximising employee involvement in strengthening the efficacy of OSH interventions in Nigerian manufacturing workplaces.

Value Relevance of Accounting Information and Share Rate: A Study of Manufacturing Companies in Nigeria

This research work determined the impact of value relevance of accounting information on the stock price of manufacturing companies in Nigeria. More specifically, the study determines the impact of earnings per share and dividends on the stock price of Nigerian manufacturing companies. Ex post facto research and data were obtained from twenty audited annual reports and financial statements. This study used the ordinary least squares (OLS) estimation from 2012 to 2021 and covered ten years with the help of E-view 9.0 data analysis revealed that there is a positive insignificant relationship between stock dividends, earnings per share and stock price in the manufacturing sector in Nigeria.

Nigeria-China Bilateral Relations: Re-examining the Trajectory of the Nigerian Manufacturing Sector

Nigeria-China trade and investment relations are claimed to move to the advantage of China. Hence, the more their trade relation flourishes, the more Nigeria experiences trade deficits, and the more China records trade surpluses. In this scenario, Nigeria depends more on imports from China than China. That is why Nigerian market is overflowed with Chinese made products such as cell phones, television sets and so forth. The study examined how Nigeria-China relations impact on the manufacturing sector in Nigeria. The study employed secondary source of data collection and relied on ‘content analysis’ as a technique for data analysis. There has been recorded failure of Nigeria to compete favourably with China in terms of import and export of manufactured products. The manufacturing sector in Nigeria remains far behind to commensurately compete with China’s. Over concentration on the oil sector is directly linked to over reliance of the Nigerian economy on oil sector. The study draws a paradigm shift from the argument that China relations with Nigeria is imperialistic, to a hypothesis that the failure of the Nigerian government to adequately reposition Nigerian manufacturing to a globally competitive status through research and development as well as human capacity building, is thus, mainly responsible. The disarticulated economic structures Nigeria is currently maintaining is less capable of guaranteeing the development of the manufacturing sector that can enjoy competitive advantages in the international markets. Policy actions that are geared towards human capacity building and provision of sustainable incentives to local investors are needed.

Exchange Rate and Manufacturing Sector Performance in Nigeria

This study examined the impact of exchange rates on the performance of the manufacturing sector in Nigeria between 1990 and 2020. Using canonical cointegrating regression (CCR) framework, the result obtained showed that exchange rate devaluation constrains manufacturing sector while exchange rate fluctuation hampers manufacturing output. The study indicated that price increase leads to decline in the manufacturing sector, the study recommends among other things the need to formulate policies that align with the exchange rate to the actual needs of the manufacturing sector. The study further suggests that change in exchange rate management strategy should be allowed to run a reasonable course of time. Jettisoning strategies at will and on frequent basis has implication for exchange rate and obvious consequence for a sector that depends on foreign inputs

Macroeconomic Policies and Foreign Capital Inflows in Nigeria

Abstract The growth of manufacturing sector output in Nigeria is currently sluggish, if not stagnant, despite massive inflows of Foreign Direct Investment (FDI) as well as macroeconomic policies initiated by successive Nigerian governments. The study investigated how macroeconomic policies and FDI inflows have impacted on the manufacturing sector in Nigeria. The Augmented Dickey Fuller (ADF) unit root test was adopted to determine the stationary properties of the data, and the order of integration of the variables was tested using the Johansen cointegration test. The impact and interactions of macroeconomic policies on the manufacturing sector are less understood and shallow in the extant literature. The government’s macroeconomic policies encourage FDI in the communications and oil sector with a negative impact on the manufacturing sector. This is implicated in inadequate capital investments and technological diffusion. Nonetheless, the study shifts the paradigm in popular arguments that FDI is imperialistic, hence universally exploitative, to a new hypothesis that the failure of the manufacturing sector to tap into FDI and yield desirable growth output is linked to less viable globally competitive macroeconomic policy frameworks in Nigeria. The study therefore recommends that the Nigerian government should review its macroeconomic policies, particularly the monetary and exchange rate, and draw up proactive human capital development plans that can directly contribute to the development of the productive capacity of the country’s population.

Firm-Learning and Productivity in Nigeria's Manufacturing Sector

ABSTRACT: The manufacturing sector plays a strategic role as a major contributor to economic growth and development. However, the harsh business environment in Nigeria has constrained learning and capability building in the Nigerian manufacturing sector. The present state of the manufacturing sector underscores the need for firm-level learning and strategic policy actions. This paper utilized data from the Enterprise Survey Panel covering the periods 2007, 2009, and 2014/2015 to investigate firm learning and productivity in the Nigerian manufacturing sector. Case study illustrations were also undertaken to further provide insights into the links between learning variables and the productivity of selected firms in the sector. Data were analyzed using descriptive statistics; dynamic panel model (DPM) via ordinary least squares (OLS) and General Method of Moments (GMM) techniques. The results of the estimation show there is a positive and significant relationship between export participation lagged by one period (t-1) and the current firm performance. A one-period lag of the learning variables, namely: skills and training increased the productivity of firms. The case study illustrations revealed that major learning capabilities include customer feedback; through employees, staff training/seminars/workshops, and supplier feedback. The paper provides evidence to conjecture that the STI mode of learning, which involves formal research and development (R&D) in firms is not deep enough, and that domestic firms have less productivity relative to firms with some proportion of foreign ownership. Also, some of the constraints to learning and productivity are an unstable regulatory environment, poor infrastructure and high cost of doing business. The paper recommends both formal and informal modes/mechanisms of learning are important to ensure improved productivity of manufacturing firms in Nigeria Also, learning opportunities may differ within and across manufacturing subsectors. Industry regulators or agencies should organize to provide a forum for firms and relevant stakeholders to regularly interact on learning experiences to learn from each other and collaborate to address obstacles to productivity.

Fiscal Policy, Private Investment and Manufacturing Sector Performance: Empirical Evidence from Nigeria with ARDL Technique

One of the greatest challenges of the Sub-Saharan African economies today is how to develop the appropriate model that will propel development in the continent. The manufacturing sector instances in China, Malaysia, Taiwan, Korea and Japan are clear models to adopt for Nigeria. The question now is, what has Nigeria been doing to develop the manufacturing sector? To this end, this study set out to examine the effect of fiscal policy and private investment on the performance of the manufacturing sector in Nigeria from 1981 to 2021. The study is time series in nature and made use of the autoregressive distributed lag (ARDL) modelling technique. It was found that domestic private investment and aggregate government spending exert a significant positive influence on the manufacturing sector performance in the long run, while the influence from tax and government revenue was significantly negative. It was then recommended that government should improve on the factors that attract more FDI inflows into the country; boosts requisite educational training skills and financial market depth to drive the influence of domestic private investment on the manufacturing sector; increase government spending on the manufacturing sector development; and that tax revenues be judiciously utilized in the long-run so that they can positively impact the manufacturing sector.

The Contributions of Exchange Rate on the Growth of Manufacturing Sector in Nigeria: An Econometric Approach

The study empirically examined the contributions of exchange on the growth of manufacturing sector in Nigeria. The specific objectives were to; examine the impact of exchange rate, money supply, and trade openness on the performance of the manufacturing sector in Nigeria. Secondary data was extracted from Central Bank of Nigeria statistical bulletin, 2020. Ordinary least square of multiple regression technique was employed to examine the impact of independent on dependent variables. Based on the results, the findings revealed that exchange rate had a negative and significant impact on performance of manufacturing sector, while money supply and trade openness had a positive and significant effect on the performance of the manufacturing sector. The study recommended that the monetary authority should introduce direct policies of regulating price stability in the economy via regulating money supply in order to decelerate the rising inflationary trend in the economy.

The Efficiency of Hard Wood Industry in Ondo State, Nigeria

Wood furniture industry is an important manufacturing sector in Nigeria for its significant contributions to the growth of national economy and industrialization as well as livelihood of the furniture makers. Therefore, evaluating efficiency of hard wood industry is important to provide useful information about the business to the furniture makers and to assist the policy makers to design appropriate policies in supporting furniture production in Nigeria. The specific objectives of this research were to describe socio-economic characteristics of furniture makers, estimate efficiency of furniture makers, determine the profitability of furniture production, identify factors influencing efficiency of furniture making and examine the problems associated with furniture makings in the study area. The study adopted a multistage sampling procedure. Data were collected from seventy furniture makers through a well-structured questionnaire. Descriptive statistics, budgetary analysis, Cobb Douglas stochastic frontier production function, inefficiency model and relative importance index were used to analyze the data. The findings revealed that 75.7% of the respondents obtained some levels of formal education; 4.3% of the furniture makers were single; 71.4% had no access to credit facility; and 7.1% exported their products beyond the boundary of Nigeria. The estimated gross margin and net profit of #7,041,255.09 (US $16,959.52) and #4,261,542.89 (US $10,264.33) respectively revealed that furniture production is profitable. The efficiency results showed that 27% of furniture makers were most technically efficient; 5.7% of them were most allocative efficient; and 10% of them were most economically efficient. Stochastic frontier production function analysis showed that firm size, labour and fixed assets had a positively significant influence on furniture production. The only identified socio-economic characteristics of furniture makers that had significant influence on efficiency of furniture production were educational level, operating experience and reinforcement training in the study area. The two critical constraints facing furniture making in the ranking scale were fluctuation of wood price and inadequacy of funds.

Effect of Company Income Tax on Corporate Performance of Listed Manufacturing Firms in Nigeria

Conundrum of the Nigerian economy is traceable to its manufacturing sector which is expected to stimulate the value-added economy and serve as a catalyst for sustainable economic transformation. Regrettably, Nigeria's manufacturing sector has been neglected without a clear policy direction with attendant annihilation of the sector from the growth process. Nigeria today is facing series of challenges when it comes to optimizing tax revenue for economic and social growth. Ex-post facto research design was adopted for this study. The population of this study covered all the 44 registered manufacturing firms dealing with consumable foods in Nigeria, purposive sampling technique was adopted to select only five listed manufacturing firms. The study found that CIT has a positive and significant effect on profit after tax (PAT) in Nigeria listed manufacturing firms that is, if there is a unit increase in Company income tax (CIT), profit after tax (PAT) will increase with over a unit. The study also found that, CIT has a positive and significant effect on Returns on Equity (ROE) while Change in Shareholders Fund (CSF) has a negative and significant effect on ROE. Based on the findings, the study concluded that, company income tax significantly affects the profit after tax, performance of the firms and earnings of shareholders. Company income tax significantly affects the profit after tax, performance of the firms and earnings of shareholders. The study therefore recommended that, fiscal policy adopted in Nigeria should consider the circumstances surrounding the activities of companies located in the country and the special role they play in the pursuit of economic growth of the nation. Also, government should ensure that revenue generated from corporate tax especially company income tax (CIT) should be utilized in the development of the general economy so as to improve the standard of living of her citizenry and increase her Gross Domestic Product (GDP).

Autoregressive distributed lag estimation of bank financing and Nigerian manufacturing sector capacity utilization

<abstract> <p>This study examined the short-term and long-term relationship between credit financing by commercial banks and capacity utilization of the manufacturing sector in Nigeria. The study employed both classical Multiple Linear Regression (OLS-MLR) and the autoregressive distributed lag model (ARDL) to analyze data representing the period 1981–2020 relating to sectoral credit finance,labor employment,and capacity utilization from the <xref ref-type="bibr" rid="b6">Central Bank of Nigeria Statistical Bulletin (2020)</xref> and <xref ref-type="bibr" rid="b38">World Bank Development Indicators (2021)</xref>. Further,the two estimation procedures were performed within a classical endogenous Cobb-Douglas production function framework that takes technical change into consideration. The bounds test indicated no long-term relationship between bank financing and average capacity utilization of the manufacturing sector in Nigeria. However,the ARDL results revealed that bank financing exerts a positive but insignificant short-term impact on the average capacity utilization of the manufacturing sector in Nigeria. Consequently,the researchers affirm that credit financing by commercial banks in Nigeria has no significant impact on the capacity utilization of the country's manufacturing sector,in neither the short run nor the long run.</p> </abstract>

STANDARD COST EFFECT ON PERFORMANCE OF SELECTED LISTED FOOD AND BEVERAGE COMPANIES IN NIGERIA, WEST AFRICA

The aim of this research was to determine whether or not a change in standard cost will improve the financial standing of a sample of Nigerian food and beverage manufacturers. This goal was reached by analyzing the relationship between the price of raw materials, the price of labor, and the price of manufacturing overhead on the bottom line of Nigerian food and beverage firms. Five manufacturing firms were chosen at random for the research. Nestle Plc, Cadbury Nig Plc, P.Z. Cussons Nig. Plc, and Presco Nig. Plc are the food and beverage companies that were included in the survey. In this case, we used secondary data that we had gathered over the previous decade (2010-2020). Panel estimation methods (pooled OLS, fixed effect estimation, and random effect) and a post estimation test were used to examine the compiled data. The results showed that a firm's performance in the manufacturing sector in Nigeria was significantly correlated with its manufacturing overhead costs, but negatively correlated with its raw material costs, and positively correlated with its labor costs. The research indicated that careful consideration of raw material costs and the maintenance of effective standard costing across all labor costs were necessary to obtain the desired results. Because of the significant savings in time and money that may be achieved via the use of standard costing principles and procedures, the research concludes that all food and beverage businesses in Nigeria should do so.

Financial Reforms in Nigeria and Its Effect on the Performance of Quoted Manufacturing Firms

The study examined the effect of financial reforms on the performance of quoted manufacturing firms in Nigeria. The study used an expo-facto research design. The study population comprises 44 manufacturing companies quoted at [1], which include Agriculture, Conglomerates, Consumer goods, Healthcare / Pharmaceuticals, Industrial goods, and Natural Resources. Thus, using a study period of 10 years (2010 – 2019) data on financial sector reforms (financial deepening, domestic credit, liquidity, market capitalisation, exchange rate and interest rate) carried out in Nigeria, being the independent variable and on performance (capacity utilization). Panel structured secondary data were collected and analyzed using the Generalized Moment of Methods (GMM) in STATA 15. The financial reform indicators: financial deepening (FDP), domestic credit, market capitalization, liquidity and exchange rate have p-values less than 0.05 (5%) level of significance, thus implying that the financial reforms’ indicators affect the performance as proxied by the capacity utilization of the manufacturing firms in Nigeria. Although, the interest rate which is one of the indicators of financial reforms returns a p-value greater than 0.05 (5%) and thus not having significant effect on the performance of the firms. The study suggested that the manufacturing firms should put measures to optimize the use of accessible funds to ensure optimal capacity utilization, as this will translate into increased productivity, profitability, and financial stability. The government should vigorously pursue monetary policies to ensure the injection of funds into the financial sector, to enhance the capacity of deposit money banks to allocate more credit to the sector at affordable rates. This will enable the optimal operation of the manufacturing sector in Nigeria.

Effect of Integrated Reporting on Firm’s Value: The Nigeria Manufacturing Sector Experience

The main objective of this study was to investigate the effect of integrated reporting on firms’ value drawing samples from listed manufacturing firms in Nigeria between the periods of 2011-2020. In this study, human capital disclosure index, manufacturing capital disclosure index, and social and relationship capital disclosure index were the integrated reporting proxies adopted to evaluate the effect on value of Nigeria manufacturing firms. Firms’ value was measured in terms of Tobin Q, and year price index was adopted as the control variable. Ex post factor research design was used and the study made use of secondary data sourced from the sampled companies’ annual reports and Nigeria Exchange Group Fact book. Data for integrated reporting variables were derived using disclosure checklist developed in accordance with the integrated reporting framework disclosure guidelines. Purposive sampling technique was used to select 51 out of the 59 manufacturing companies listed on the Nigeria Exchange Group. In order to examine the cause-effect relationship between the dependent variable and independent variables as well as to test the formulated hypotheses, the researcher used a robust regression analysis. The results of the analysis showed that the disclosure of human capital information in the annual report of listed manufacturing firms in Nigeria significantly improves the firm’s value. Based on this findings, it was concluded that only the variable of human capital disclosure has significant effect on firms’ value. Finally, the study recommended that the management of manufacturing firms in Nigeria should capture all disclosure items concerning human capital in their financial statements as this tends to improve the value of the firm and increase shareholders’ wealth. It was also recommended that management should develop an inclusive organizational culture for disclosing non-financial information with long term value creating capacity as they can maximise the market value of the firm over the short, medium and long term horizon.