Nigerian Manufacturing Sector Research Articles

Corporate earnings, dividend payments, and stock price behavior of manufacturing firms listed in Nigeria

The purpose of the study is to investigate the effects of corporate earnings and dividend payments on the stock price behaviour of manufacturing firms in Nigeria between 2013 and 2022. The study adopted an ex-post facto research design, and deployed Generalised Method of Moments (sys-GMM) and Granger causality tests for the data analysis. The two-step system GMM is used to control for omitted variables such as bias, unobserved panel heterogeneity or heteroscedasticity, autocorrelation within panels or groups, endogeneity issues, and measurement errors in the data. Findings show that share price (SP) and its predictors yield valuable insights into the factors influencing stock valuation. Dividend per share (DPS) emerges as a significant positive predictor, suggesting a notable impact on share price. Firm size (FSZ) proves to be a statistically significant predictor, indicating that the size of a firm plays a role in influencing stock prices, with larger firms associated with a decrease in share price. Conversely, Earnings per Share (EPS) and Dividend Yield (DY3) do not exhibit statistical significance, suggesting limited predictive power in the model. By way of conclusion, the study provides an understanding of the factors influencing share price behavior within the Nigerian manufacturing sector and the positive impact of past performance, particularly lagged share prices, confirming the persistence of stock market trends. The practical implications of this study are that it underscores the understanding of financial dynamics in emerging economies, particularly in the context of manufacturing firms in Nigeria.

Export Diversification Drive: The Role of Nigerian Manufacturing Sector

This research delves into the enigmatic relationship between Nigeria’s manufacturing sector and the nation’s drive for export diversification. Leveraging a regression analysis and time series data from 1985 to 2022, it paints a nuanced picture of their complex interplay. The analysis confirms the stationarity of all variables at first differenced. Additionally, the Johansen co-integration test reveals a long-run equilibrium relationship between them, suggesting that while their short-term fluctuations may diverge, they are ultimately bound by a deeper interdependence. The analysis exposes a weak and negative association between the two, hinting at the meagre contribution of the manufacturing sector to export diversification during the studied period. This underscores the need for a critical reevaluation and targeted interventions to unlock the sector’s potential as a powerful engine of export growth. Therefore, the study advocates for a paradigm shift in approach. Instead of government’s piecemeal efforts, it should champion the creation of a robust and vibrant manufacturing ecosystem, pulsating with innovation and productivity. This vision will envision modern factories humming with cutting-edge processes, meticulously crafting highquality goods capable of holding their own on the global stage. From value-added agricultural products to sophisticated machinery, the potential portfolio of Nigerian exports is vast and brimming with promise.

Efficiency of Public Educational Expenditures in Nigerian Manufacturing Sector: A Data Envelopment Analysis

Efficient resource allocation plays an essential role in manufacturing productivity, with a need to assess expenditure efficiency before addressing the impact of education. Amidst global growth in education budgets, financial strain requires improved allocation with a focus on efficiency to mitigate deficits. The manufacturing sector in Nigeria has experienced a consistent decline in productivity and prolonged stagnation over the years, as well as a decrease in capacity utilization. Based on this premise, this study aims to examine the effect of public educational expenditure on the efficiency of resources used in the Nigerian manufacturing sector over the period 1981-2019. The Data Envelopment Analysis is used to estimate the efficiency scores for the years under examination. The results show that, within the DEA estimation of efficiency, public educational capital expenditure does not result in the efficient use of resources for the majority of years under investigation except for the year 2019; only 16 years on public educational recurrence expenditure showed constant returns, and no years showed a decreasing return to scale, compared to the year 1982. The inefficiencies in utilising resources are linked to scale inefficiencies, and the government should target public spending policy to increase the size of capital projects in the education sector.

Impact of Power Supply on the Performance Nigerian Manufacturing Sector: 1999-2018

Impact of Power Supply on the Performance Nigerian Manufacturing Sector: 1999-2018

Impact of asset intensity and other energy-associated CO2 emissions drivers in the Nigerian manufacturing sector: A firm-level decomposition (LMDI) analysis

The study considered the impacts of asset intensity and other energy-associated CO2 emissions drivers in the Nigerian manufacturing sector from 2010 to 2020. The Logarithmic Mean Divisia Index (LMDI) was used to explore the driving factors of CO2 emissions: asset intensity, economic output, economic structure, energy intensity, energy mix, and carbon emission coefficient. From the results, the CO2 emissions decreased from 7.49 MtCO2 in 2010 to 3.22 MtCO2 in 2020. Furthermore, among the emissions drivers, the energy mix effect increased CO2 emissions by 0.50 MtCO2, followed by asset intensity (0.29 MtCO2) and economic structure (0.11 MtCO2). The energy intensity, economic output, and emission coefficient effects inhibited CO2 emissions by −4.64 MtCO2, −0.42 MtCO2, and −0.01 MtCO2 respectively. The contribution of the subsectors' emissions shows that the Other Manufacturing subsector emitted 14.62 MtCO2, while Chemical and Pharmaceutical emitted 14.61 MtCO2, Food, Beverages and Tobacco, 7.55 MtCO2, Textile, Apparel, and Footwear, 6.63 MtCO2, Basic Metal and Iron and Steel, 5.15 MtCO2, Plastic and Rubber Products, 2.99 MtCO2, Agro-Allied, 2.71 MtCO2, Oil Refining, 2.01 MtCO2, and Pulp and Paper Products, 1.76 MtCO2. The results indicated that the effect of asset intensity on emission growth is significant and should not be overlooked. Likewise, the effects of CO2 emission drivers were found to impact differently across the subsectors. The latter suggests that firm-specific indicators in the respective subsectors should be one of the primacies during policy development since the driving factors of CO2 emissions fluctuate across the subsectors.

Export Diversification Drive: The Role of Nigerian Manufacturing Sector

Export Diversification Drive: The Role of Nigerian Manufacturing Sector

Decision-Making Techniques for Supply Chain Management: An Empirical Analysis of Just-In-Time Inventory System

Many organizations face a severe problem in developing decision-making frameworks for complicated supply chain management (SCM), which has driven them to keep improving supply chain models. This study examines Just-in-time (JIT) factors and its effect on SCM in the Nigerian manufacturing sector, with a specific focus on Olam PLC in Ilorin, which was used because it is the only international agricultural manufacturing firm that competes for supplies in the region. The survey research design was used to gather data through a questionnaire from 265 members of Olam employees selected randomly, of which 253 were valid. The data was analyzed, and hypotheses were tested through PL-SEM at a significance threshold of 0.05 using SmartPLS3. Results demonstrated that JIT has a standardized beta value and the P value of 0.981 and 0.000 on SCM, and its r2 indicated 96% on SCM, indicating that JIT has a significant effect on SCM. In conclusion, therefore, effective integration of JIT inventory management in business processes enhances continuous improvement and enhanced supply chain management.

EFFECTIVENESS OF RISK MANAGEMENT IN NIGERIA’S MANUFACTURING ENTERPRISES

This study seeks to examine the effectiveness of enterprise risk management (ERM) implementation in the Nigerian manufacturing sector. The objective of this study is to analyze the risks faced by manufacturing firms in Nigeria and to recommend actions to address and reduce anticipated hazards. This research used both inferential and descriptive statistics to examine the effectiveness of ERM application in Nigeria’s manufacturing sector. The data for this study were collected from the financial statements of manufacturing firms and other relevant publications by manufacturing firms in Nigeria from 2016 to 2020. The study found that ERM has a positive relationship with financial performance indicators such as return on investment, dividend, earnings per share, market capitalization, price earnings ratio, and dividend per share. The study recommends that manufacturing companies in Nigeria should implement ERM as an ongoing activity to improve their risk management practices, enhance their effectiveness, and ensure their long-term sustainability. This study contributes to the literature on ERM implementation in the Nigerian manufacturing sector and provides valuable insights for policymakers, regulators, and business managers.

Impact of Banks’ Credits and Capital Market Dynamics on the Performance of the Manufacturing Sector in Nigeria: An ARDL Bounds Testing Approach

In this study, we examined the impact which bank credits and some capital market variables had on the performance of the Nigerian manufacturing sector. Secondary time series data from 1986 to 2017 was used which was analysed using an ARDL bounds testing to cointegration. The results showed that while MCR negatively and significantly impacted on manufacturing output, TVTR and ASI positively and significantly increased the growth of the manufacturing output. BCRM, on the other hand, impact on manufacturing output was positive but insignificant. We made some recommendations.

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.

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.

The Role of Internal Audit in Enhancing Corporate Governance Practices in the Nigerian Manufacturing Sector

Corporate governance is a crucial aspect of any organization, especially in the Nigerian manufacturing sector. Effective corporate governance practices are essential for promoting transparency, accountability, and sustainable business growth. Internal audit plays a significant role in ensuring that these practices are adhered to and maintained. This conceptual paper aims to explore the role of internal audit in enhancing corporate governance practices in the Nigerian manufacturing sector through review of scholarly literature. The article revealed that internal audit plays a vital role in enhancing corporate governance practices in the Nigerian manufacturing sector. The internal audit function provides independent and objective assurance to the board and management that the organization's systems and processes are operating effectively, efficiently, and ethically. The paper also highlighted the challenges faced by internal auditors in Nigeria, including inadequate resources, lack of awareness about the internal audit function, and the perception that internal audit is only focused on financial reporting. The study recommends that the internal audit function should be adequately resourced, and internal auditors should receive continuous professional development training to keep up with emerging trends and best practices in corporate governance. Overall, this study provides valuable insights into the crucial role of internal audit in enhancing corporate governance practices in the Nigerian manufacturing sector. The study's findings can guide organizations in improving their corporate governance practices by leveraging the internal audit function's strengths to enhance transparency, accountability, and sustainable business growth. Keywords: internal audit, corporate governance, Nigerian manufacturing sector, sustainable business growth DOI: 10.7176/RJFA/14-10-04 Publication date: May 31 st 2023

Environmental Disclosure and The Quality of Financial Reports of Listed Nigerian Manufacturing Firms

This study examined the relationship between environmental disclosure and the quality of financial reports in Nigerian manufacturing sector. The specific objectives were to examined the relationship between environmental donations and sponsorship disclosure on the quality of financial reports among manufacturing firms in Nigeria; examined the relationship between environmental restoration disclosure on the quality of financial reports among manufacturing firms in Nigeria, accessed the relationship between environmental waste management disclosure on the quality of financial reports among manufacturing firms in Nigeria and ascertain the relationship between environmental donations and sponsorship disclosure, restoration and waste management disclosure and the quality of financial reports among manufacturing firms in Nigeria. Ex-post facto research design was adopted and a final sample size of 10 manufacturing firms was purposively selected for a period of 10 years. The data were collected through content analysis method. Descriptive and inferential statistics were used to analyzed collated data. Findings revealed that two out of the three components of the environmental accounting information, namely, Environmental Restoration (ER),and Environmental Donations and Sponsorship (EDS) have no significant influence on the quality of financial reports among the manufacturing firms. Thus, the null hypothesis were accepted. The study concluded that the influence of the disclosure of accounting information about environmental restoration, and environmental donations and sponsorship on the quality of financial reports of manufacturing firms in Nigeria were insignificant. It was recommended that Standard setters and policy makers should work with the Ministry of Environment to consider introducing mandatory disclosures which are consistent.

The Impact of Knowledge Management Processes on Innovation Implementation: Nigerian Manufacturing

The Nigerian manufacturing industry significantly influences national economic diversification and growth. However, it faces several challenges, including insufficient infrastructure, talent shortages, and foreign direct investment. The study investigates how KM processes impact innovation in the Nigerian industry. We surveyed 424 manufacturers and found that better KM processes (acquisition, creation, application, and sharing) lead to improved innovation implementation. The results demonstrated that KM processes considerably impacted innovation implementation in the Nigerian manufacturing sector. Knowledge acquisition, creation, application, sharing, and storage all have a favourable effect on innovation implementation ability. The findings emphasise the significance of adequate information flow, investment in research and development, and technological capabilities for promoting innovation. This study shows the link between KM practices and innovation outcomes in the Nigerian industry. This study has implications for improving competitiveness and sustainability. A work environment that prioritizes continuous learning, collaboration, and technology for knowledge management would be beneficial.

Examining the Adoption of International Financial Reporting Standard on Nigeria Manufacturing Industries: An Issue for Quality Financial Reporting

Pressures brought on by the globalisation of accounting standards prompted modifications to reporting systems all across the globe. It was noted that the application of the IFRS standard hasn't stopped inflated earnings and has no relationship to corporate performance. But given the results of other studies, it's challenging to say whether the execution of IFRS has occasioned in high-quality financial reports in the manufacturing sectors. The implementation of IFRS and the caliber of financial disclosure in Nigeria's industrial sector are the subjects of this study. Both primary and secondary data were employed in the investigation. The sampling cited manufacturing industries' internal and external auditors and accountants provided the source data. The secondary data was gathered from the annual reports of three (3) chosen manufacturing companies listed between 2006 and 2017 on the Nigerian stock exchange. The statistical connection between IFRS implementation and the caliber of financial disclosure in the Nigerian manufacturing sector was assessed using a multiple regression approach. The performance of manufacturing companies under the Nigerian GAAP and IFRS was measured using paired sample T-test. The results discovered that IFRS execution has a substantial positive link with quality of financial reporting in Nigeria manufacturing industry. The paper concluded and recommended that institutional and legal system should be considered in order to guarantee enhancement in transparency and comparability in financial report.

Digitalna transformacija i efikasnost preduzeća u proizvodnom sektoru Nigerije

The effects of a digital technologies uptake on firm efficiency in the Nigerian manufacturing sector were examined. The combined application of data envelopment analysis and the Tobit regression methods were employed to analyze the cross-sectional survey data derived from a sample of manufacturing firms. The research results showed that the uptake of digital technologies was still skewed to the low-end appliances/devices, whereas the uptake of the high-end digital technologies required to forge the digital transformation of firms was still low. Manufacturing firms in Nigeria need to make a quick transition to high-end digital technologies in order for them to increase their efficiency and competitiveness in the global marketplace. Challenges to the uptake of digital technologies need to be addressed as well. The training/retraining of personnel need be scaled up so as to build the digital capacity of the sector, bolster efficiency and improve the productivity of operations. The importation of digital devices may be an option in the short run, but local production should be ramped up in the long run.

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>

The Influence of Tone at the Top on Financial Statement Fraud of Listed Manufacturing Firms in Nigeria

Financial statements prepared by the management remains the umbilical cord that connects the financial health of an enterprise to the various stakeholders who rely on them to take informed economic decision. However, the contemporary global business community has unimaginably been submerged in the recent wave of the shocking death of notable corporate entities sooner after the publication of juicy profits which metamorphosed from the poor and ineffective tone at the top orchestrated by top management in collaboration with the independent external auditors. Most of these corporate collapses were associated with the top management with widely exercised corrupt practices. The inefficient or nonexistence of tone at the top in most of entities contributed to the widespread violations and exploitation of accounting loopholes. These apparent upsurge of recently doctored financial statements frauds have resulted in the impairment of firm’s productivity, operational efficiency, damages reputation for businesses, heavy financial losses, collapse of an entire organization and have severely eroded the stakeholders’ confidence and public trust. The thrust of this study is to establish and develop efficient and formidable tone at the top that will help to ameliorate financial statement fraud rascality in the quoted Nigerian manufacturing sector. Ethical leadership strategy, corporate ethical culture and risk management practices were used as the proxies of tone at the top while improper revenue recognition dimension of the financial statements fraud. The researchers adopted correlational survey design for the study and used primary data via structured questionnaire. The null hypotheses were formulated and tested at 0.05 level of significance and other data were analyzed by Pearson Product Moment Correlation and multiple linear regression model with the aid of Statistical Packages for the Social Sciences version 25. The study found that all the tone at the top proxies; Ethical leadership strategy, corporate ethical culture and risk management practices positively and significantly related to improper revenue recognition of quoted Nigerian manufacturing companies in the period of this study. The study concludes that tone at the top effectively and significantly related with the financial statement fraud. We recommend that the policymakers to prompt manufacturing companies in the country to develop strategies for tone at the top with strong ethical approach where employees will be trained and re-trained on the need always to do what is rightful and needful at every moment in the society and workplace. We also suggest that the parents should give their wards very good upbringing so that they can be useful in society and will be free from all social vices such as fraud.

CAPITAL MARKET AND MANUFACTURING SECTOR OUTPUT IN NIGERIA 1990 TO 2021

The importance of the capital market to sustained growth and development of an economy cannot be overstated. The capital market acts as a catalyst for rapid and sustained manufacturing growth, especially in capitalist economies. However, the role of the capital market in the development of the Nigerian manufacturing sector has remained unaddressed and the effect has not been felt despite several policy tools by the government aimed at improving the manufacturing sector. The paper investigated the effect of capital market on manufacturing sector output in Nigeria from 1990 to 2021. The ARDL-ECM method of analysis was adopted in carrying out the analysis. Findings from the paper revealed that market capitalization has a positive impact on the manufacturing sector's output. The study recommends steps aimed at improving the capital market and all share indexes as both have a positive and significant impact on the manufacturing sector output as well as put in place measures to ensure that share prices are reflective of their real values.

Exploring the CO2 emissions drivers in the Nigerian manufacturing sector through decomposition analysis and the potential of carbon tax (CAT) policy on CO2 mitigation

The CO2 emissions trend and their reduction potential in the Nigerian manufacturing sector from 2010 to 2020 were studied. The Logarithmic Mean Divisia Index was applied to decompose the change in CO2 emissions into pre-set factors: carbon intensity effects, firm energy intensity effects, cost structure effects, asset-turnover effect, asset-to-equity effect, equity-funded production effect and productive capacity utilization. The results show that the change in emissions increased by 1668times {10}^{12} GJ between 2010 and 2020. Energy intensity and equity-funded production were the leading drivers of increased emissions, while productive capacity utilization reduced emissions. The CO2 emissions increased throughout the study, except for a few periods. Without a carbon tax policy, the results show that firm-level drivers increased CO2 emissions in the business-as-usual scenario. However, under the 5% carbon tax (CAT) policy scenario on energy consumption, there was a reduction in CO2 emissions between 2010 and 2020. Furthermore, a CAT policy of 5% on energy consumption reduced CO2 emissions by 22%. A further implication of CAT policy, given its interaction with firm-level drivers, resulted in lowering CO2 emissions in the interactional scenario. The findings indicate productive capacity utilization, equity-funded production, and CAT impacted CO2 emissions variation.