EFFECT OF CORPORATE GOVERNANCE ON THE FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA

Abstract

This study examines the influence of corporate governance on the financial performance of listed deposit money banks in Nigeria between 2018 and 2024 using an ex-post facto research design. Data were sourced from the annual reports of fourteen (14) banks and the Central Bank of Nigeria’s Statistical Bulletin and analyzed within a panel framework. After a Hausman test favored fixed‐effects estimation, financial performance was operationalized via the return on assets (ROA), while governance variables included board meetings and board diversity with bank size as a control variable. The findings reveal that board meeting has significant positive effect on financial performance whereas board diversity revealed insignificant negative effect on financial performance. The study recommends that banks should institutionalize a structured meeting calendar that guarantees regular and substantive engagement on risk oversight. This can be facilitated by incorporating a practice of quarterly or more frequent meetings focused explicitly on capital adequacy, liquidity stress testing, and emerging risk trends, boards can convert meeting frequency into a strategic tool for early warning and corrective action. And also, banks should pursue efforts to build an inclusive culture and continuous learning environment that ensures the full advantages of gender diversity are tapped. This may be advanced through mentorship schemes which encourages the pairing of seasoned directors with new female appointees. This can help translate demographic diversity into deeper insights and more robust decision-making.