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- W2560767574 abstract "The Securities and Exchange Commission in Nigeria (SEC), in keeping with her mandates of promoting good corporate governance in Nigeria and also complying with the global trend, recommended Code of Corporate Governance for quoted firms in Nigeria in 2003. The code made strong recommendations for the separation of the position of the CEO and the board chair, and the dominance of outside directors, among others for quoted firms in Nigeria. The recommendations are geared towards resolving the principal-agency problem which is grounded in the agency theory. Agency problem arises whenever managers have incentives to pursue self-interest (self-serving behaviour) at the expense of shareholders. Most studies on corporate governance focused on how to effectively monitor the agents (resolving the conflict) against self-serving bahaviour in order to protect shareholders interest. Although it should be conceded that resolving the principal-agent problem is an important issue in the corporate governance of firms, the global financial and economic crisis of 2007/08 exposed other forms of weaknesses in firms’ corporate governance systems, particularly their critical decisions. It has been argued that some corporate boards lacked independence; directors often failed to make meaningful contributions to safeguard the growth and development of the firms. This raises an important question of whether the insufficient representation of outside directors is the possible explanation of boards’ failure to fulfill their monitoring roles. To test empirically whether board composition matters, it has been suggested that, rather than examining a board’s monitoring effectiveness by using the firm financial performance as proxy, a more accurate evaluation can be gained by examining discrete decisions that involve a potential conflict of interest between management and shareholders. To add to the debate, this paper examined the impact of board composition on the critical decisions of Nigerian firms. The survey method was used in generating data for the study while the Product Moment Correlation technique was employed to test the study hypotheses. The result of the correlation coefficients shows that there is a positive correlation between firms’ critical decisions, namely, CEO Compensation, CEO Tenure, Debt Intensity, Unrelated Diversification, Intensity of Expenditure on Research and Development and boards dominated by nonexecutive directors. Based on this positive result, it was recommended that government should enforce the recommendations of Code of Corporate Governance that stipulated a higher proportion of non" @default.
- W2560767574 created "2016-12-16" @default.
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- W2560767574 date "2015-01-01" @default.
- W2560767574 modified "2023-09-26" @default.
- W2560767574 title "Impact of Board Composition on Critical Board Decisions - Evidence from Nigeria" @default.
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