CORPORATE GOVERNANCE PRACTICES AND PERFORMANCE OF OIL AND GAS COMPANIES IN NIGERIACORPORATE GOVERNANCE PRACTICES AND PERFORMANCE OF OIL AND GAS COMPANIES IN NIGERIA
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Abstract
The broad objective of this study is to investigate the effect of good corporate governance practices on the performance of Nigerian oil and gas firms using a five (5) year time frame that span through 2018 to 2022. To achieve this objective, the researcher selected specific corporate governance mechanism proxies which have been widely employed in related extant
literature to ascertain the extent to which board size, audit committee, board gender, and board Independence affects performance of oil and gas firms in Nigeria. This study employed ex-post facto and descriptive research design on a panel data set sourced from annual financial reports of listed oil and gas firms in Nigeria. Further, Descriptive statistics, Correlation Matrix Assessment and Balanced regression analysis technique were used for data analysis. Specifically, the result reveals mixed evidence suggesting that the effect of corporate governance on performance of oil and gas firms depends specifically on the
proxy/s employed. Particularly, the findings reveal that while board size and board Independence have a positive and statistically significant relationship with firm performance proxied by return on asset(ROA) in Nigeria. However, board gender and audit committee
showed no statistically significant relationship with firm performance during the period
under review. Therefore, based on these empirical outcomes, the study recommends among
others that policymakers should ensure a balanced board representation and a careful
consideration of board Independence of firms in Nigeria. This can be achieved by reviewing
and updating existing governance guidelines to emphasize the importance of board size in
enhancing performance of oil and gas firms in Nigeria. Additionally, consider strengthening
regulatory capacity by reviewing the adequacy of legal enforcement provisions and consider
measures to increase the representation of females on boards.
literature to ascertain the extent to which board size, audit committee, board gender, and board Independence affects performance of oil and gas firms in Nigeria. This study employed ex-post facto and descriptive research design on a panel data set sourced from annual financial reports of listed oil and gas firms in Nigeria. Further, Descriptive statistics, Correlation Matrix Assessment and Balanced regression analysis technique were used for data analysis. Specifically, the result reveals mixed evidence suggesting that the effect of corporate governance on performance of oil and gas firms depends specifically on the
proxy/s employed. Particularly, the findings reveal that while board size and board Independence have a positive and statistically significant relationship with firm performance proxied by return on asset(ROA) in Nigeria. However, board gender and audit committee
showed no statistically significant relationship with firm performance during the period
under review. Therefore, based on these empirical outcomes, the study recommends among
others that policymakers should ensure a balanced board representation and a careful
consideration of board Independence of firms in Nigeria. This can be achieved by reviewing
and updating existing governance guidelines to emphasize the importance of board size in
enhancing performance of oil and gas firms in Nigeria. Additionally, consider strengthening
regulatory capacity by reviewing the adequacy of legal enforcement provisions and consider
measures to increase the representation of females on boards.
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