CORPORATE GOVERNANCE AND FINANCIAL SUSTAINABILITY OF LISTED INSURANCE COMPANIES IN NIGERIA

ABSTRACT

This study examined the connection between the financial performance of Nigerian insurance businesses and corporate governance. The ethical conduct of individuals who cede corporate control is improved by good company governance. This study specifically looked at the diversity, independence, size, committee composition, and meetings of the board as well as how these factors related to the financial success of Nigerian insurance businesses as determined by return on assets. All 43 insurance businesses licenced by the Insurance Regulatory Authority between 2012 and 2015 were included in the study.Multiple linear regression analysis was used in the study.Since the information came from the company's financial records, it was gathered from secondary sources. The Statistical Package for Social Sciences (SPSS) was used to code, clean, and analyse the data after it had been thoroughly checked for accuracy. The findings also revealed a modest negative link between board size and return on assets, while a large positive correlation was observed between board diversity and return on assets.The insurance company's financial performance was found to be minimally affected by the frequency of board meetings, whereas board diversity, board committee, and board committee were found to be statistically significant. ANOVA was used to assess the multiple linear regression models overall, and the F-statistic that was produced showed that the model was significant at the 95% significance level.According to the study, while selecting a board of directors, players in the Nigerian insurance business should consider factors such as board diversity, committees, and meetings, as they are important indicators of financial performance. That is, the composition of the board need to be such that it aids in the enhancement of the insurance firms' overall performance.The results of this study indicate that board size and independence shouldn't be given priority because they have little bearing on how well listed companies do financially.The study's variables accounted for 52% and 66% of the variation in firm financial performance over the course of the four study years, suggesting that there may be other significant factors that are left out of the model. As a result, the study suggests that management take these factors into account in order to improve the corporate governance index.The report also suggests that in order to improve corporate governance's effectiveness, policymakers should establish an index of corporate governance that would serve as a standard for all insurance companies.