The Roles of Corporate Governance in the Nigeria Commercial Banks’ Performance.
ABSTRACT
The research focuses on the roles of corporate governance in the Nigeria commercial bank performance, a case study of UBA (United Banks of Africa).
The major objective of the study is, to determine the extent to which noncompliance with corporate governance codes by the bank executives contributed to this present crisis and management problem, to ascertain the relationship between cooperate governance and the performance of commercial banks in Nigeria.
To investigate if there is any significant change in the performance of banks in Nigeria by the proper implementation of corporate governance by the board of the directors and to empirically determine factors that militates against successful implementation of corporate governance framework in commercial banks.
Data were collected through primary and secondary sources. The descriptive survey method was used and the
research tool was questionnaire. Total of 129 respondents were obtained using a strained random sampling techniques by balloting and they answered the questionnaire.
Data analysis using Chi-square formula and presentation was done by the use of tables. The major findings from the study are: the factors that militate against successful implementation of corporate governance framework in
commercial banks are high.
On the basis of the above findings; the study concludes that competitive advantage is an important factor in the strategic management of companies.
On the basis of the above findings it was recommended that: Corporate Governance is necessary to the proper functioning of banks and that Corporate Governance can only prevent bank distress only if it is well implemented. Steps should also be taken for mandatory compliance with the code of corporate governance.
Also, an effective legal framework should be developed that specifies the rights and obligations of a bank, its directors, shareholders, specific disclosure requirements and provide for effective enforcement of the law.
For the purposes of further studies, further research could explore the relationship in more in specific categories for example, in not-for-profit organizations, in government organizations, and in family companies. Since this study focused on the Nigeria banking sector it would be beneficial to have a clearer understanding of corporate governance roles in other types of organizations.
Such research could address the similarities and differences of the roles in different organizations and consider also the legal requirements for different organizations.
TABLE OF CONTENTS
Tite Page i
Approval Page ii
Certification Page iii
Dedication iv
Acknowledgments v
Abstract vi
CHAPTER ONE: INTRODUCTION
1.1: Background of the Study 1
1.2: Statement of the Problem 5
1.3: Objectives of the Study 8
1.4: Research Questions 8
1.5: Research Hypotheses 9
1.6: Significance of the Study 10
1.7: Scope of the Study 10
1.8: Limitations of the Study 11
1.9: Definition of relevant terms
CHAPTER TWO: REVIEW OF RELATED LITERATURE
2.0 Background of the case study: Profile of UBA 12
2.1 Conceptual Framework 38
2.2 Theoretical Framework 67
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Research Design 76
3.2 Area of the study 76
3.3 Population of the study 76
3.4 Procedure for Data Collection 76
3.5 Sample and Sampling Techniques for the Study 77
3.6 Data Collection Instrument 78
3.7 Validation of the Instrument 79
3.8 Method of Data Analysis 80
CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS
4.1 Data Presentation 82
4.2 Test of Hypotheses 91
CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
5.1 Summary of Major Findings 101
5.2 Conclusions 101
5.3 Recommendations 103
5.4 Suggestions for Further Study 104
Bibliography 106
INTRODUCTION
1.1 Background of the Study
The issue of corporate governance has recently been given a great deal of attention in various national and International forays. This is in recognition of the critical role of corporate governance in the success or failure of companies.
Corporate governance refers to the processes and structures by which the business and affairs of an institution are directed and managed. In order to improve long-term shareholder value by enhancing corporate performance and accountability, while taking into account the interest of other stakeholders.
Corporate governance is therefore about building credibility, ensuring transparency and accountability as well as maintaining an effective channel of information disclosure that would Foster good corporate performance.
The strategy for addressing the challenges of corporate governance has taken various forms at both the national and International levels and have culminated in initiatives such as: the OECD Code; the Cadbury Report; the Basel Committee Guidelines on Corporate Governance; the King’s Report of South Africa etc.
It is therefore necessary to point out that the concept of corporate governance of banks and very large firms have been a priority on the policy agenda in developed market economies for over a decade.
BIBLIOGRAPHY
Abidin, Z. Z., Nurmala Mustaffa Kamal, N. M., & Jusoff, K. (2009). Board Structure and Corporate Performance in Malaysia. International Journal of Economics and Finance, 1, 150-164 retrieved from http://www.ccsenet.org/journal.html on February 20, 2010
Adams R and Mehran H (2008): Corporate Performance, Board Structure and their Determinants in the Banking Industry. Federal Reserve Bank of NY Staff Report No 330
Adams, R and Ferreira, D (2003): A Theory of Friendly Boards. The Academy of Management Review, Vol.22, No.3, 609-611
Adams, R. and Mehran, H. (2002): What Do Boards Do? Evidence from Board Committee and Director Compensation. EFA 4005, SSRN
Adams, R. and Mehran, H. (2003): Is Corporate Governance Different For Bank Holding Companies? Federal Reserve Bank of New York, Economic Policy Review 9, pp 123-142