Corporate Governance and Firm Performance in Nigeria: First Bank Nigeria PLC as a Case Study
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Abstract
The research study is to examine the influence of corporate governance on firm performance of First Bank Nigeria PLC. It made use of board committee, audit committee, board size and corporate governance disclosure index as corporate governance predictive variables. The research design adopted is the longitudinal survey research design. The model parameters were estimated using Ordinary Least Squares with time series data for the period 2006 to 2016 for First Bank Nigeria PLC. The stationarity, stability, co-integration and causal relationship between the explanatory variables and the dependent variable in the model were performed. The study employed the application software E-View 7.0. The results of ADF and PP roots tests indicate that the series are unit roots free. The co integration of the variables using Residual Unit Roots test, which is appropriate in this study, indicates long run relationships among the series. The use of Recursive Residual Technique shows that the variables are stable. The model has an explanatory power of 78 percent specifically adjusted for the degrees of freedom with regard to the explanatory variables. The DW statistics value of 1.82 indicates the absence of serial correlation. The F- probability value of 0.0000 reports that there is a simultaneous linear relationship between the dependent variable and all the explanatory variables combined. This suggests that the joint effects of all the included variables in the model are significant in explaining firm performance of the First Bank Nigeria PLC. The study revealed that the explanatory variables significantly impact on firm performance of First Bank Nigeria PLC. In view of the research findings planning the improvement in board committee, audit committee, board size and corporate governance disclosure index will help to increase firm performance of organizations among others.
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