Board characteristics and the financial performance of Nigerian quoted firms

Purpose The purpose of this paper is to investigate the impact of corporate board characteristics on the financial performance of Nigerian quoted firms. Board characteristics studied comprise board size, board skill, board nationality, board gender, board ethnicity and CEO duality. Design/methodology/approach The study employed the random‐effects and fixed‐effects generalised least squares (GLS) regression to test the six hypotheses formulated for the study, while controlling for firm size and firm age. Findings Using panel data from 122 quoted firms in Nigeria between 1991 and 2008, it was found that board size, CEO duality and gender diversity were negatively linked with firm performance, whereas board nationality, board ethnicity and the number of board members with a PhD qualification were found to impact positively on firm performance. The result of the robustness test using the same board characteristics for 160 small firms showed that board duality was positively linked to firm performance, while a PhD qualification was negatively linked to firm performance. Practical implications The study contributes to the understanding of the board‐performance link by examining both the traditional variables such as board size, CEO duality and other organisational attributes such as ethnic diversity, foreign nationality and competence variables represented by women and PhD holders, respectively. The results provide an insight for practitioners and policy makers on the importance of relying on institutional specifics in the prescription of corporate governance codes. Originality/value The study adds value to the global corporate governance discourse in two ways: first, the use of Nigeria, which is claimed to have one of the weakest business cultures in the world, and secondly, using a good number of proxies that are country‐specific for corporate boards.