Ceo power, board monitoring, board diversity and firm performance in Nigeria
CEO opportunistic tendency is one of the key issues that agency theory attempts to resolve by suggesting a better board structure that is good enough to monitor the firm‟s executives. Stewardship theory holds an opposing view. Other theories including resource dependence, resource base and social ne...
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| Main Author: | |
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| Format: | Thesis |
| Language: | eng eng eng |
| Published: |
2021
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| Subjects: | |
| Online Access: | https://etd.uum.edu.my/9461/1/Depositpermission-not%20allow_s901391.pdf https://etd.uum.edu.my/9461/2/s901391_01.pdf https://etd.uum.edu.my/9461/3/s901391_02.pdf |
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| Summary: | CEO opportunistic tendency is one of the key issues that agency theory attempts to resolve by suggesting a better board structure that is good enough to monitor the firm‟s executives. Stewardship theory holds an opposing view. Other theories including resource dependence, resource base and social network theories provide
useful explanation of CEO and board in relation to firm outcomes. This study investigates the effect of CEO power, board monitoring and board diversity on firm financial performance. Analyses are made using secondary data from listed firms in Nigeria from 2011 to 2016. Four objectives of this study are: to investigate the effect
of CEO power on firm financial performance; to investigate the effect of board monitoring on firm financial performance; to examine the moderating effect of board independence on the relationship between CEO power and firm financial performance; and to investigate the relationship between board diversity on firm
financial performance. The results show that CEO power as a composite function does not affect firm financial performance but four CEO power indicators, in particular, CEO duality, insider, education and financial expertise are positively related to firm financial performance. The result also shows that board interlocking
improves firm financial performance. Foreign directors are also important for a board in that they improve firm financial performance. There are three contributions of this study. First, it offers theoretical contribution by testing multiple theories in the CEO power studies and using the resource dependency theory on board international diversity in Nigeria. Second, this study contributes by providing new empirical evidence from Nigeria which includes the relationship between CEO power and firm financial performance. Third, this study contributes to the research design by using interaction model and composite function in examining the CEO power and firm financial performance |
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