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An Assessment of Non-Executive Directors Influence on the Operating Profits of Manufacturing Firms in Nigeria

Ejike Sylvester I ()

International Journal of Academic Research in Accounting, Finance and Management Sciences, 2018, vol. 8, issue 2, 1-7

Abstract: The debate of whether board composition in the form of representation of non-executive directors may add value to the firm’s performance is widely covered in the corporate governance literature. The main purpose of this study is to assess the non-executive board on operating profits of manufacturing firms in Nigeria. The study adopted content Analysis using a cross sectional survey among 20 selected manufacturing firms listed in Nigeria Stock Exchange. Data were obtained from the financial statement of the various organizations. Inferential statistics of linear regression was used for the hypothesis. The result (0.06175656 with p-value of (0.004357858) of the study shows significant at 1% probability level of significance, data observed confirm that pNED has a negative coefficient of -0.09416348 with a p-value of 0.0101306) which is statistically significant.. It was concluded that proportion number of directors to a large extent affects operational profit of manufacturing firms. Therefore, it can be concluded that manufacturing firms in Nigeria can increase their efficiency as well as overall profitability by maintaining a balanced non-executive members in their firm, as a result the firms can maximize their operational efficiency and profitability.

Keywords: Non-executive board; operating profit; manufacturing firms (search for similar items in EconPapers)
Date: 2018
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