BOARD STRUCTURE AND FIRM PERFORMANCE IN EMERGING ECONOMIES: EVIDENCE FROM NIGERIA

Abstract

evaluating performance is one of the main goals of business owners because they need to continually improve efficiency in the use of resources. over the years the board of directors have been criticized for performance of firms and their subsequent failure. The study attempts to explore the impact of board structure as a corporate governance mechanism on the performance of firms in Nigeria. To test the hypothesis of the study, we use a sample of 4 publicly traded cement firms in Nigeria for a period of 3 years, 2020-2022. The methodology of the study is quantitative using secondary data source. Regression coefficient was estimated on the collected data. The selected dependent variables used as proxies for performance are return on assets (ROA) and return on equity (ROE) while the selected independent variable used as proxies for board structure are board size and independence. The result shows that board size has a negative impact on ROA while board independence has a positive impact on ROA. However, Board size has positive impact on ROEand Board independence has positive impact on ROE. The study recommends that the management of publicly traded cement companies should discourage large board size and make board independence a priority in order to enhance the firm performance.