Board Characteristics and Firm Performance: Evidence from Nigerian Quoted Companies

Abstract

The broad objective of this study is to investigate the relationship between board characteristics and corporate performance. Time series data from 166 firms quoted on the Nigerian Stock Exchange market from 2005 to 2012 in the Food and Beverages sector was used for the study. We adopt the log of profit after tax as the measure of performance. The study found a positive and significant relationship between independent directors on audit committee and firm performance in Nigeria. The study suggests the need for a competent and sizeable board and a cut down on the waste of resources on too frequent board meetings as the findings reveals that there is a negative relationship between board diligence and performance. The study also gave emphasis on the need to strengthen the independence of audit committee to continuously achieve the control mechanism and oversight functions.

DOI: 10.5901/mjss.2015.v4n1p283