Board Characteristics and Financial Performance of DMBs: Evidence from Nigeria

  • Johnson Emberga Aernan University of Nigeria
  • Steve Emeka Emengini University of Nigeria
  • Bonaventure Sunday Okonkwo University of Nigeria
Keywords: Board Size, Independent Non-Executive Director, Board Meetings, Board Diversity, Ethnic Diversity, Tobin’s Q
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The study examines the effect of corporate board characteristics on the performance of listed DMBs in Nigeria. This study used secondary data extracted from the annual reports of 12 listed firms in Nigeria during the period 2011 – 2020. The study employed Tobin’s Q as a proxy of firm performance, while Board size, Independence, diligence, gender diversity, and ethnic diversity are employed as the proxies of board characteristics. The Pooled Ordinary Least Square regression (POLS) and panel fixed effect regression methods were used to analyse the data collected. Findings revealed that board size and board ethnic diversity exerts a statistically significant negative influence on DMBs' financial performance, board independence has a negative and non-significant effect on DMBs financial performance, while board diligence and gender diversity have a positive non-significant effect on DMBs' financial performance. The study recommends among others that board size be carefully analysed by shareholders and balanced according to the expected result, board independence be continuously maintained and periodically reviewed, a maximum of 6 board meetings excluding emergency meetings be held annually; board members should consist of at least half gender diversity, and finally, ethnic heterogeneity be allowed on the boards of Nigerian firms for equity, fair representation, and relative peace


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1 March, 2023
How to Cite
Aernan, J., Emengini, S., & Okonkwo, B. (2023). Board Characteristics and Financial Performance of DMBs: Evidence from Nigeria. East African Journal of Business and Economics, 6(1), 47-58.