CORPORATE GOVERNANCE AND PERFORMANCE OF BANKS IN NIGERIA
ABSTRACT The focus of this study is corporate governance and banking performance in Nigeria. corporate governance has been identified to mean different things to different people. The objectives of this work is to investigate if there is any significant relationship between directors equity holding and bank performance in Nigeria and also to determine empirically if there is any significant relationship between corporate governance disclosure and the financial performance of banks in Nigeria. The exploratory design (regression) approach was adopted and the computerized regression analysis using SPSS 17.0 was employed as the statistical tool. The variables for corporate governance are return on equity(ROE) and profit margin(PM) while the variables of performance of banks are board size, board composition, CEO and the audit committee. The major findings in this research is that, there is a significant relationship between directors equity holding and the performance of banks in Nigeria and also state that there is a significant relationship between corporate governance disclosure of banks in Nigeria and their performance. The researcher recommended that step s should be taken for mandatory compliance with the code of corporate governance. Also an effective legal frame work should be developed that specifies the rights and obligations of a bank ,its directors ,shareholders ,specific disclosure requirement and provide for effective enforcement of the law.
- TABLE OF CONTENTS Title Page i Declaration ii Certification iii Dedication iv Acknowledgements v Abstract vi Table of Contents vii CHAPTER ONE 1.1 Background of the Study 1 1.2 Statement of the Problem 5 1.3 Research Questions 8 1.4 Objectives of the Study 8 1.5 Research Hypothesis 9 1.6 Significance of the Study 9 1.7 Scope and Limitation of Study 10 1.8 Definition of Terms 11 1.9 Summary 12 1.10 References 14 CHAPTER TWO: LITERATURE REVIEW 2.0 Conceptual Review 15 2.1 What is Corporate Governance? 15 2.2 Corporate Governance Measures in Nigeria 17 2.2.1 The Roles of the Board of Directors 18 2.2.2 Shareholders Right and Privilege 19 2.2.3 The Role of the Audit Committee 20 2.3 Corporate Governance and Bank 23 2.4 Elements of Corporate Governance in Banks 28 2.4.1 Regulation and Supervision as Elements of Corporate 31 Governance in Banks 2.5 Corporate Governance Mechanisms 38 2.5.1 Shareholders 38 2.5.2 Deb Holders 40 2.6 Linkage between Corporate Governance and Firm Performance 44
- 2.7The Role of Internal Corporate Governance Mechanism in Organizational Performance46 2.7.1 Role of Auditor 47 2.7.2 Role of Board of Directors Composition 47 2.7.3 Role of Chief Executive Officer 49 2.7.4 The Role of Board Size 51 2.7.5 Role of CEO Duality 52 2.7.6 Role of Managers 52 2.8 Regulatory Environment for Banks in Nigeria 54 2.9 Theoretical Review 57 2.9.1 Stakeholder Theory 58 2.9.2 Stewardship Theory 60 2.9.3 Agency Theory 63 2.9.4 Agency Relationship in the Context of the Firm 65 2.11 Summary 71 References 72