IMPACT OF A DIVERSE BOARD ON THE FINANCIAL EFFICIENCY OF CORPORATIONS IN NIGERIA

Abstract

This study aimed to determine if and how a more diverse board of directors impacted financial efficiency at Nigerian corporations. Twenty-two (22) deposit money banks traded on the Nigerian Exchange Group had their 2020 audited financial reports combed through for supplementary information. Research employed Ordinary Least Squares estimation through the E-views statistical software. The return on assets was the dependent variable, whereas the size of the board, the makeup of the board, and the percentage of women on the board were the independent factors. According to the results of a regression analysis, the nationality of board members has little affect on the return on assets, although the gender and size of the board both have substantial effects. According to the study's findings, Nigerian businesses benefited greatly from having more ethnically and racially diverse board members. Banks were instructed to increase the number of women on their boards and reduce the number of foreign board associates because there is no link between the nationality of board memberships and the rate of return on assets. In addition, the board should not be excessively huge but rather made up of knowledgeable specialists.