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Corporate governance characteristics, company performance and executive compensation : the case of Nigeria

Odewale, Robert Waidi (2016) Corporate governance characteristics, company performance and executive compensation : the case of Nigeria. PhD. thesis, Universiti Utara Malaysia.

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Abstract

Executive compensation has attracted much attention as it is exacerbating the agency conflicts. This study extends prior research by examining the influence of corporate governance practice on executive compensation by listed companies in Nigeria, a country that is characterized by low investor protection rights, weak enforcement and compliance mechanism that is very much different from the developed markets. Specific attention is paid to the role of multinational companies’ ownership. The data was from 215 company-year observations for the period 2009 to 2013. The time period coincides to the two years before and two years after the publication of the Code of Corporate Governance for Public Companies in Nigeria 2011 (CG Code 2011). The fixed-effects regression was used for testing the study’s hypotheses. The result shows there is no significant difference between the executive compensation of the multinational companies and those of the domestic companies. However, the executive compensation after the publication of CG Code 2011 was higher than that before its publication. Further, the findings indicate that board attributes (board size, board composition, Chief Executive Officer (CEO) duality, gender diversity, compensation committee, and compensation committee independence) do not constrain CEO from extracting higher compensation in Nigerian Listed Companies (NLCs). The independence of compensation committee shows significant positive association with executive compensation. The ownership structure (CEO ownership, directors’ ownership, and blockholders ownership) do not substitute for effective monitoring of the executives. However, the study shows multinational companies’ ownership to be negatively related to executive compensation. Finally, the study results indicate that there are latent weaknesses in the internal corporate governance mechanism operational in NLCs. This result has implication for regulators of Nigeria’s capital market, investors, board of directors, company management, researchers and other company stakeholders.

Item Type: Thesis (PhD.)
Uncontrolled Keywords: executive compensation, corporate governance, multinational companies, ownership structure
Subjects: H Social Sciences > HD Industries. Land use. Labor. > HD4801-8943 Labor. Work. Working Class
Divisions: Tunku Puteri Intan Safinaz School of Accountancy (TISSA)
Depositing User: Mr. Badrulsaman Hamid
Date Deposited: 24 May 2018 00:31
Last Modified: 24 May 2018 00:31
URI: http://etd.uum.edu.my/id/eprint/6748

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