Corporate Board Attributes and Capital Structure of Listed Food Products Companies in Nigeria

The MasterMind Project Yusuf Abubakar 92 PAGES (22246 WORDS) Dissertation
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ABSTRACT

This study examines the impact of corporate board attributes on capital structure of listed food products companies in Nigeria. The study utilized documentary data collected from factbook as well as annual reports and accounts of the sampled companies for the period 2002 to 2013. Panel data methodology was employed for the analysis of the data, therefore ordinary least square (OLS) and fixed effect techniques were applied to estimate the model developed. The panel data help to explore both cross-sectional and time serries data symultaneously. The study documents a significant positive impact of board size and board composition on the capital structure of companies while CEO duality shows strong negative impact on capital structure. Furthermore, the control variables size and profitability have positive impact but age impacts negatively on capital structure of the companies. The study concludes that larger board maximizes use of debt and non-executive directors uses their status and connection to facilitate debt for the companies. The study recommends that board’s chairman and CEO should be different individuals and that board size should have a minimum of 5 and maximum of 15 members as recommended by SEC code of corporate governance. 


Table of Contents

DECLARATION .......................................................................................................................ii

CERTIFICATION ....................................................................................................................iii

APPROVAL .............................................................................................................................iv

ACKNOWLEDGEMENTS ....................................................................................................... v DEDICATION.........................................................................................................................vii ABSTRACT.............................................................................................................................. xi

CHAPTER ONE INTRODUCTION

  1. 1.1  Background to the study.......................................................................................1

  2. 1.2  Statement of the Research Problem ...................................................................4

  3. 1.3  Objectives of the study.........................................................................................5

  4. 1.4  Hypotheses of the study .....................................................................................5

  5. 1.5  Significance of the Study .....................................................................................6

  6. 1.6  Scope of the study ................................................................................................9


    CHAPTER TWO LITERATURE REVIEW

  1. 2.1  Introduction........................................................................................................10

  2. 2.2  The Concept of Corporate Governance..............................................................10

    2.2.1 Basic Principles of Corporate Governance ............................................................. 12

    2.2.2 Corporate Governance Code...........................................................................15

    2.2.3 Concept of Board of Directors ................................................................................ 16

    2.3 Concept of Capital Structure..............................................................................18

    2.3.1 Factors Determining Capital Structure ...................................................................22

2.4. Review of Empirical Studies on Corporate Board Attributes and Capital Structure ...................................................................................................................24

2.4.1 Board Size and Capital Structure............................................................................24

2.4.2 Board Composition and Capital Structure .............................................................. 27

2.4.3 COE duality and Capital Structure..........................................................................29

2.4.4 Other factors Affecting Capital Structure ............................................................... 31

2.5 Theoretical Framework ......................................................................................34

2.5.1 Corporate Governance and Agency Theory............................................................34

2.5.2 Capital Structure and the Pecking Order Theory .................................................... 36

2.5.3 Capital Structure and the Static Trade-off Theory...........................................37

viii

      

CHAPTER THREE RESEARCH METHODOLOGY

3.1  Introduction........................................................................................................43

3.2 Research Design..............................................................................................43

3.3 Population of the Study....................................................................................43

3.4 Sample Size and Sampling Technique...........................................................44

3.5 Sources and Method of Data Collection .........................................................45

3.6 Variables Definition and Measurement..............................................................45

3.7 Technique for Data Analysis...........................................................................47

3.8 Robustness Test of Independent and Dependent Variables ...............................50


CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS

4.1 Introduction ........................................................................................................51
4.2 
Analysis of Data .................................................................................................51
4.3. Descriptive Statistics.........................................................................................51

4.4 Correlation Matrix of the Variables ...................................................................53

4.5 Data Presentation and Discussion of Results.....................................................54


CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS

5.1 Summary ............................................................................................................60

5.2 Conclusions........................................................................................................62

5.3 Recommendation................................................................................................62

5.4 Frontiers for Further Research ...........................................................................63


List of Tables
Table 3.1: Population of the Study................................................ 44

Table 3.2: Sample Size............................................................. 45

Table 4.1: Descriptive Statistics of the Data......................................52

Table 4.2: Correlation Matrix of the Variables....................................53

Table 4.3: Regression Results.......................................................55



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APA

The MasterMind, P (2021). Corporate Board Attributes and Capital Structure of Listed Food Products Companies in Nigeria. Afribary.com: Retrieved February 24, 2021, from https://afribary.com/works/corporate-board-attributes-and-capital-structure-of-listed-food-products-companies-in-nigeria

MLA 8th

Project, The MasterMind. "Corporate Board Attributes and Capital Structure of Listed Food Products Companies in Nigeria" Afribary.com. Afribary.com, 21 Feb. 2021, https://afribary.com/works/corporate-board-attributes-and-capital-structure-of-listed-food-products-companies-in-nigeria . Accessed 24 Feb. 2021.

MLA7

Project, The MasterMind. "Corporate Board Attributes and Capital Structure of Listed Food Products Companies in Nigeria". Afribary.com, Afribary.com, 21 Feb. 2021. Web. 24 Feb. 2021. < https://afribary.com/works/corporate-board-attributes-and-capital-structure-of-listed-food-products-companies-in-nigeria >.

Chicago

Project, The MasterMind. "Corporate Board Attributes and Capital Structure of Listed Food Products Companies in Nigeria" Afribary.com (2021). Accessed February 24, 2021. https://afribary.com/works/corporate-board-attributes-and-capital-structure-of-listed-food-products-companies-in-nigeria