Examining the impact of corporate governance and corporate financial reporting on firm value: A study of selected banks in Nigeria

Grace Oyeyemi  Ogundajo; Festus Folajimi  Adegbie; Samuel Kolawole  Oyegoke; Folorunso  Akande; Eunice Ayooluwa Ajayi-Owoeye

doi:10.33094/ijaefa.v16i2.926

Authors

Grace Oyeyemi Ogundajo Department of Accounting, School of Management Sciences, Babcock University, Nigeria. https://orcid.org/0000-0002-5223-7136
Festus Folajimi Adegbie Department of Accounting, School of Management Sciences, Babcock University, Nigeria. https://orcid.org/0000-0002-0030-9353
Samuel Kolawole Oyegoke College of Postgraduate Studies, Babcock University, Nigeria. https://orcid.org/0009-0009-2868-0128
Folorunso Akande Department of Finance, School of Management Sciences, Babcock University, Nigeria. https://orcid.org/0000-0002-6894-5831
Eunice Ayooluwa Ajayi-Owoeye Department of Accounting, School of Management Sciences, Babcock University, Nigeria. https://orcid.org/0000-0002-6877-0912

DOI:

https://doi.org/10.33094/ijaefa.v16i2.926

Keywords:

Board independence, Corporate financial reporting, Corporate governance, Earnings persistence, Earnings predictability, Firm value, Gender diversity.

Abstract

Globally, managers are always under intense pressure to meet stakeholders’ desired firm value expectations, creating uncertainties and apprehensiveness when making corporate strategic plans. Prior studies have laid claims that best corporate governance practices and corporate financial reporting quality are important in achieving a successful and sustainable value for banks. Consequently, this study examined the impact of corporate governance and corporate financial reporting on the value of selected banks in Nigeria. This study made use of panel data extracted from the audited annual reports and accounts of the thirteen (13) selected banks for fifteen (15) years which yielded 195 firm-year observations. Random-effects Generalized Least Square (GLS) regression estimation technique was employed for the analysis. The study discovered that corporate governance and corporate financial reporting exerted a significant positive impact on the value of selected banks in Nigeria (Adj.R² = 0.48, Wald Sat. (4, 190) = 18.3, p < 0.05). The study concluded that corporate governance and corporate financial reporting collectively are important determining factors of the value of selected banks in Nigeria. Enforcing strict compliance with financial reporting regulations to ensure transparency, reliability, and earnings quality would enhance analysts’ and users’ forecast and predictive abilities.