Effect of Board Characteristics on Financial Performance of Listed Deposit Money Banks in Nigeria

Abstract

This study investigated the impact of board features on the financial performance of publicly listed deposit money banks in Nigeria. The study population comprised twelve (12) deposit money institutions registered on the Nigerian Exchange Group. The data utilised for hypothesis testing in the study was sourced using a census random sampling technique. The hypothesis results indicated that board size and board independence considerably and positively impacted return on assets (ROA). Board diversity significantly influenced ROA, however the frequency of board meetings did not demonstrate a statistically significant effect on financial success. The results corresponded with established research, emphasising the significance of proficient corporate governance in improving firm performance. The results suggest that banks should maintain an ideal board size that harmonises diverse expertise with effective decision-making processes. The selection of independent directors must to be reinforced to improve accountability and reduce managerial opportunism. In conducting regular board meetings, priority should be given to the efficacy of talks over their frequency. Policies advocating for board diversity should be promoted, as diverse boards enhance financial performance and risk management.