Examining the Link between Technical Efficiency, Corporate Governance and Financial Performance of Firms: Evidence from Nigeria

Adedoyin Isola Lawal, Lawal-Adedoyin Bose Bukola (), Olujide Olakanmi, Timothy Kayode Samson, Nwanji Tony Ike, Abiodun Samuel Ajayi, Fakile Samuel Adeniran, Oseni Ezekiel, Opeyemi Oyelude and Grace Adigun
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Adedoyin Isola Lawal: Department of Economics, Bowen University, Iwo 232102, Nigeria
Lawal-Adedoyin Bose Bukola: Department of Accounting & Finance, Landmark University, Omu Aran 251103, Nigeria
Olujide Olakanmi: Department of Economics, Bowen University, Iwo 232102, Nigeria
Timothy Kayode Samson: Department of Statistics, Bowen University, Iwo 232102, Nigeria
Nwanji Tony Ike: Department of Accounting & Finance, Landmark University, Omu Aran 251103, Nigeria
Abiodun Samuel Ajayi: Department of Accounting & Finance, Landmark University, Omu Aran 251103, Nigeria
Fakile Samuel Adeniran: Department of Accounting & Finance, Landmark University, Omu Aran 251103, Nigeria
Oseni Ezekiel: Department of Finance, University of Lagos, Lagos 101017, Nigeria
Opeyemi Oyelude: Deptartment of Business Administration, Bowen University, Iwo 232102, Nigeria
Grace Adigun: Department of Economics, Bowen University, Iwo 232102, Nigeria

JRFM, 2022, vol. 15, issue 11, 1-13

Abstract: The purpose of this study is to examine the link between technical efficiency and both the corporate governance and financial performance of listed financial firms on the floor of the Nigerian Stock Exchange using three theoretical approaches: shareholder theory, stakeholders’ theory, and resource dependence theory. We employed a stochastic frontier analysis to examine the impact of technical efficiency on the link between corporate governance and financial performance on the one hand, and, on the other, multiple regressions comprised of OLS and Poisson estimates to analyze a data-generating set sourced from 2007 to 2020. The results of our OLS estimates suggest that a negative but significant relationship exists between the corporate governance mechanism and the financial performance of the listed firms. When we subject the analysis to the Poisson estimates, the relationship becomes positive and significant. Our results have some positive implications.

Keywords: corporate governance; technical efficiency; firm performance; financial firms; Nigeria (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2022
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