Effect of Board Characteristics on Financial Performance of Quoted Agricultural Firms in Nigeria

Abstract

The study examines the effect of board characteristic on financial performance of quoted agricultural firms in Nigeria. board characteristics is the independent variable proxied by (board size, board diligence, board independence and board gender while financial performance (dependent variable) was proxied by return on equity. These were with the view of examining the relationship that exists between board characteristics and performance of quoted agricultural firms in Nigeria. The study which covered a ten-year period (2010–2019) made used of secondary data sourced from published annual reports and accounts of 5 purposively selected quoted agricultural firms on the Nigerian Stock Exchange (NSE).In other to ensure the validity and the reliability of our data, the study therefore subjected the data to a diagnostic test using Descriptive Statistic Analysis, normality test, Correlation Matric, random effect regression analysis with the help of Stata13. Empirical evidences from the hypothesis tested indicated that Board characteristic, Board Size, Board Diligence, Board Independence and Board Gender has no significant effect on the financial performance of quoted agricultural firms during the period understudied. The study recommends among others that reduction of board sizes will be critical to the success and survival of corporate quoted firms in Nigerian while firms should also increase their size through increase in liquidity and put these to efficient use in order to enjoy economies of scale. The size of the board must not be unwieldy so that company’s businesses can be managed effectively and efficiently by the board members.