Ownership Structure and Performance of Selected Quoted Manufacturing Companies in Nigeria

Kazeem Toyin Cynthia and Omole Ilesanmi Isaac
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Kazeem Toyin Cynthia: Department of Business Administration and Management, School of Business and Management Studies, Federal Polytechnic, Ile-Oluji, Ondo State, Nigeria
Omole Ilesanmi Isaac: Department of Accountancy, School of Business and Management Studies, Federal Polytechnic,Ile-Oluji, Ondo State, Nigeria

International Journal of Research and Innovation in Social Science, 2021, vol. 05, issue 12, 725-735

Abstract: This study evaluated the effect of equity ownership structure on the financial performance of selected quoted manufacturing companies in Nigeria. The focus of the evaluation is on the relationship between ownership structure variables (managerial, institutional and foreign) on firm performance (Return on Equity and Return on Asset). Data were collected for this study through secondary source for the period 2011 – 2020. 60 manufacturing firms listed on the Nigerian Stock Exchange were purposively sampled.Data were collected on variables such as institutional owners’ equity, managerial ownership equity, foreign ownership equity, Total Assets, shareholders’ fund and earnings after interest and tax was collected from the Annual Reports of companies. Data collected was analyzed using tables, descriptive statistics, correlation and regression analysis. Also, the data collected were subjected to pooled General Least Square, Random and Fixed Effects regression model in testing the hypotheses of the study. It was discovered thatall the variables i.e. (ROTA, ROE, MON, LEV, LASSET, ION, FON and AGE) had correlation coefficients that were very low and less than 0.9 having either positive or negative values.It was discovered that all the series showed high level of consistency because all mean and median values were within the maximum and minimum values of the series. The deviation of the actual data from their mean value were exceptionally high, typically demonstrated by the relatively high value of the standard deviations. The study recommended that improvement should be made on corporate governance to focus on sound equity ownership structure to attract foreign investors. Likewise, Industrial investors should emphasize the importance of inclusion of institutional investors in companies ownership structures and collisions between the directors and dominant shareholders should be prevented

Date: 2021
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