Impact of Human Capital Expenditure on Financial Performance of Listed Insurance Companies in Nigeria

Adebukola Atoyebi Taibat, Okpe Onuh Emmanuel and Bamidele Oyebisi Abdulwaheed
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Adebukola Atoyebi Taibat: University of Abuja, Nigeria
Okpe Onuh Emmanuel: University of Abuja, Nigeria
Bamidele Oyebisi Abdulwaheed: University of Abuja, Nigeria

International Journal of Research and Innovation in Social Science, 2024, vol. 8, issue 8, 7-20

Abstract: This study assessed the impact of human capital expenditure on the financial performance of listed insurance companies in Nigeria. The population of the study consisted of twenty – three (23) insurance companies listed on Nigerian Exchange Group among which nine (9) companies were sampled for a period of ten (10) years from 2012 to 2021. Employee’s Salaries and wages, Employee’s Retirement Benefits, Employee’s Training Costs and Other Employee Benefits were adopted as proxies for human capital expenditure, while Profit Before Tax was adopted as proxy for financial performance. Secondary data were collected from the sampled insurance companies’ annual reports and accounts over the period of study. Panel Least Square analysis method was used to analyze the collected data. The findings of the study revealed that employees’ salaries and wages and employee’s retirement benefits have significant positive impact, and employee’s training costs and other employee’s benefits have no significant impact on the financial performance of Insurance companies in Nigeria. The study therefore, recommended that; insurance companies in Nigeria should carefully consider and invest in competitive and fair compensation packages for their employees, prioritize and enhance their employee retirement benefit packages and evaluate the cost-effectiveness of additional benefits and focus on other factors that more directly influence their financial performance.

Date: 2024
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