BOARD OF DIRECTORS’ CHARACTERISTICS AND THE PROFITABILITY OF LISTED BANKS IN NIGERIA

Abstract

This study investigated the connection between board of directors’ characteristics and the Nigerian listed banks' profitability. The study adopted secondary data sourced from the published financial statements of 12 listed commercial banks in Nigeria. The study covered a period of 10 years beginning from 2012 to 2021. The study estimated profitability using return on equity (ROE), while board of directors’ characteristics was estimated using board size, diversity, independence and diligence. The panel data were analyzed with descriptive statistics, diagnostic tests and inferential statistics. According to the study's statistical findings, board independence has a strong association with profitability, although board diversity, board diligence, and board size continue to have little bearing on it. According to the study, corporate board characteristics as a whole have a substantial impact on the profitability of listed banks in Nigeria. On the basis of the result, the study recommends that companies should focus on appointing qualified and independent directors to their boards. This can be done by developing a clear and concise nomination policy and by using a professional search firm to identify qualified candidates

Keywords: Board Size, Board Diligence, Board Independence, Board Gender Diversity.