ABSTRACT
Board risk management committee, which is a subset of corporate governance and its effects on financial performance, has been under-researched for a period of time in empirical investigations. In this regard, this study examined the effects of Board risk management committee on financial performance. While Board risk management committee was operationalized using Board size, Board independence and Board meetings, financial performance was depicted by stock returns. Three hypotheses were formulated and tested. Secondary data were collected from annual reports of eleven deposit money banks in Nigeria. The data collected were analysed using statistical tools such Pearson correlation, unit root, as well as OLS Regression Analysis. Findings indicated that Board risk management committee size has negative and significant effect on stock returns of Deposit money banks in Nigeria (p- value=0.0019< 0.05); While Board risk management committee independence has no significance impact on stock returns of Deposit money banks in Nigeria. (p- value=0.4785>0.05); Results also shows that Board risk management committee meetings has negative and significant relationship with Stock returns of Deposit money banks in Nigeria (p- value= 0.0259 < 0.05). Based on findings, the study concluded that increase in board risk management committee size and meetings have negative effect on stock returns due to the impact of exogenous factors on stock returns. It was recommended that Deposit money banks should control their Board size, include independent (non- executive) directors (although not significant but recommended) and reduce number of meetings held in other to maximize stock returns.
KEW WORDS: Board risk management committee, Board size, Board independence, Board meetings, financial performance, Stock returns, Deposit money banks.
TABLE OF CONTENTS
TITLE PAGES
Title Page i
Integrity Attestation ii
Certification iii
Dedication iv
Acknowledgements v
Table of Contents vii
Abstract xi
CHAPTER ONE: INTRODUCTION
1.1 Background to the Study 1
1.2 Statement of the Problem 5
1.3 Research Objective 7
1.4 Research Questions 8
1.5 Research Hypothesis 8
1.6 Scope of the Study 9
1.7 Significance of the Study 10
1.8 Operational Definition of Terms 10
CHAPTER TWO: LITERATURE REVIEW
2.1 Preamble 12
2.2 Conceptual Review 12
2.2.1 Corporate governance 12
2.2.2 Board risk management committee 13
2.2.3 General role of the risk committee 14
2.2.4 Board risk management committee size 15
2.2.5 Board risk management committee independence 16
2.2.6 Board risk management committee meetings 18
2.2.7 Financial performance 19
2.2.8 Stock returns 20
2.3 Conceptual framework 22
2.4 Theoretical review 23
2.4.1 Stakeholders theory 23
2.4.2 Stewardship theory 24
2.4.3 Signaling theory 25
2.4.4 Agency theory 26
2.5 Empirical review 29
CHAPTER THREE: RESEARCH METHODS
3.1 Preamble 32
3.2 Research Design 32
3.3 Area of the study 32
3.4 Population of the study 33
3.5 Sampling size and sampling techniques 33
3.6 Type and source of data 34
3.7 Measurements of variables 34
3.7.1. Dependent variable 34
3.7.2 Independent variables 35
3.8 Model specification 36
3.9 Methods of data analyses 37
3.10 Limitations of the methodology 38
CHAPTER FOUR: DATA PRESENTATION, ANALYSIS AND INTERPRETATION
4.1 Preamble 39
4.2 Descriptive Analyses 39
4.2.1 Correlation Analysis 41
4.2.2 Test for Normality 42
4.2.3 Panel Unit Root Test 43
4.3 Test of hypotheses 45
4.3.1 Hypothesis One 45
4.3.2 Hypothesis Two 45
4.3.3 Hypothesis Three 45
4.4 Discussion of Findings 48
CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Preamble 51
5.2 Summary of Findings 51
5.3 Conclusion 52
5.4 Recommendations 53
5.5 Suggestions for further Studies 53
5.6: Contributions to Knowledge 54
REFERENCES 55
APPENDIX 62
Posu, V. (2024). EFFECTS OF BOARD RISK MANAGEMENT COMMITTEE ON FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA. Afribary. Retrieved from https://afribary.com/works/effects-of-board-risk-management-committee-on-financial-performance-of-deposit-money-banks-in-nigeria
Posu, Victor "EFFECTS OF BOARD RISK MANAGEMENT COMMITTEE ON FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA" Afribary. Afribary, 18 May. 2024, https://afribary.com/works/effects-of-board-risk-management-committee-on-financial-performance-of-deposit-money-banks-in-nigeria. Accessed 07 Sep. 2024.
Posu, Victor . "EFFECTS OF BOARD RISK MANAGEMENT COMMITTEE ON FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA". Afribary, Afribary, 18 May. 2024. Web. 07 Sep. 2024. < https://afribary.com/works/effects-of-board-risk-management-committee-on-financial-performance-of-deposit-money-banks-in-nigeria >.
Posu, Victor . "EFFECTS OF BOARD RISK MANAGEMENT COMMITTEE ON FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA" Afribary (2024). Accessed September 07, 2024. https://afribary.com/works/effects-of-board-risk-management-committee-on-financial-performance-of-deposit-money-banks-in-nigeria