CORPORATE GOVERNANCE MECHANISMS AND EARNINGS MANAGEMENT OF LISTED MANUFACTURING COMPANIES IN NIGERIA
Keywords:
Corporate governance, earnings management, discretionary accruals, board meetings, gender diversityAbstract
The objective of this study is to ascertain the relationship between corporate governance mechanisms and earnings management in Nigeria. The study adopted data procured from the Central Bank of Nigeria Statistical Bulletin, the Nigerian Exchange Limited, and the companies’ yearly reports for the period 2014-2023. A sample of 10 firms was selected from the listed companies for a 10years period making for 100 observations. Board size, Board meeting, Board gender diversity, Audit committee meeting were used as independent variables, while Discretionary accruals was adopted as a proxy of earnings management and dependent variable. The data were described and analysed using the panel regression technique on the multiple regression model. Findings from the analysed data showed that; board size has positive but insignificant effect on earnings management, board gender diversity has a negative and insignificant effect on earnings management, board meeting has a negative and insignificant effect on earnings management, and audit committee meeting has a positive but insignificant effect on earnings management of manufacturing companies in Nigeria. Thus, the study concluded that corporate governance mechanisms has no significant effect on earnings management in Nigeria. Therefore the study recommended as follows: Firms focus more on the quality and effectiveness of board members. Organizations should promote and encourage greater inclusion of women on corporate boards. Board meetings of firm should be effective and focus driven. Quality, independence, and expertise of audit committee members should be emphasized.
References
Abdou, H. A., Ellelly, N. N., Elamer, A. A., Hussainey, K., & Yazdifar, H. (2020). Corporate governance and earnings management nexus: Evidence from the UK and Egypt using neural networks. International Journal of Finance & Economics, 1-31.
Akpotor, V. A., Ezeabasili, N. V., & Chukwunulu, J. J. (2024). Profitability ratios and stock returns of deposit money banks in Nigeria: 2011-2022. African Banking and Finance Review Journal, 17(17), 42-56.
Al-Baidhani, A. M. (2014). Review of the corporate governance bundle. Corporate Ownership & Control, 11(4), 236-241.
Almashhadani, M., & Almashhadani, H. A. (2022). Internal mechanisms features, unfavourable behaviour and firm performance. International Journal of Business and Management Invention, 11(4), 1-6.
Appah, E. (2022c). Corporate governance mechanisms and financial performance of listed consumer goods firms in Nigeria [Doctoral dissertation, Ignatius Ajuru University of Education].
Assensoh-Kodua, A. (2019). The resource-based view: A tool of key competency for competitive advantage. Problems and Perspectives in Management, 17(3), 143-153.
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99-120.
Biswas, S., Bhattacharya, M., Sadarangani, P. H., & Jin, J. Y. (2022). Corporate governance and earnings management in banks: An empirical evidence from India. Cogent Economics & Finance, 10(1), 2085266. https://doi.org/10.1080/23322039.2022.2085266
Denis, D. K., & McConnell, J. J. (2023). International corporate governance. Journal of Financial and Quantitative Analysis, 38(3), 1-36.
Dennis, I. (2018). What is a conceptual framework for financial reporting? Accounting in Europe, 15(3), 374-401.
Dong, N., Wang, F., Zhang, J., & Zhou, J. (2020). Ownership structure and real earnings management: Evidence from China. The British Accounting Review, 4(1), 50-59.
Efunniyi, C. P., Abhulimen, A. O., Obiki-Osafiele, A. N., Osundare, O. S., Agu, E. E., & Adeniran, I. A. (2024). Strengthening corporate governance and financial compliance: Enhancing accountability and transparency. Finance & Accounting Research Journal, 6(8), 1597-1616.
Elemeforo, A. (2023). Corporate governance and earnings management of deposit money banks in Nigeria. Federal University Otuoke Journal of Management Sciences, 5(2), 98-107.
Fan, Y., Jiang, Y., Zhang, X., & Zhou, Y. (2019). Women on boards and bank earnings management: From zero to hero. Journal of Banking & Finance, 107(1), 1-21.
Fan, Z., Radhakrishnan, S., & Zhang, Y. (2021). Corporate governance and earnings management: Evidence from shareholder proposals. Contemporary Accounting Research, 38(2), 1434-1464.
Fasusi, O. C., Akinrinola, O. O., & Nwidobie, B. M. (2025). Corporate governance and financial performance of Nigerian National Petroleum Company Limited. African Journal of Accounting and Financial Research, 8(2), 67-83.
Fowler, D. S. (2023). Ethical implications of deceptive earnings management practices. Business Ethics and Leadership, 7(3), 84-96.
Harris, O., Karl, J. B., & Lawrence, E. (2019). CEO compensation and earnings management: Does gender really matter? Journal of Business Research, 98(1), 1-16.
Hosam, Eko, & Wuryan. (2019). Impact of board characteristics on earnings management in international oil and gas companies. Academy of Accounting and Financial Studies Journal, 23(1), 1-26.
Huynh, Q. L. (2020). A triple of corporate governance, social responsibility and earnings management. Journal of Asian Finance, Economics and Business, 7(3), 29-40.
Ibitamuno, D., Onuchuku, O., & Nteegah, A. (2018). Corporate governance and banking sector performance in Nigeria. Journal of Applied Economics and Business, 6(4), 35-50.
Ibitomi, T., Akinleye, B. O., & Adinnu, P. O. (2024). Corporate governance and earnings management among listed companies in Nigeria. European Journal of Accounting, Auditing and Finance Research, 12(11), 1-25.
Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305-360.
Kurawa, M. J., & Ahmed, I. (2020). Audit quality and earnings management of listed non-financial companies in Nigeria. Global Scientific Journal, 8(7), 105-123.
Mohammed & Oladejo. (2022). Audit tenure and financial reporting quality of listed Nigerian deposit money banks (2008-2018). European Business and Management, 8(4), 81-88.
Naciti, V., Cesaroni, F., & Pulejo, L. (2022). Corporate governance and sustainability: A review of the existing literature. Journal of Management and Governance, 26(1), 55-74.
Olufemi. (2021). Board gender diversity and performance of listed deposit banks in Nigeria. European Business and Management, 7(1), 14-23.
Omesi, I., & Appah, E. (2021). Corporate governance and tax avoidance of listed consumer and industrial goods companies in Nigeria. IOSR Journal of Economics and Finance, 12(2), 17-31.
Orazalin, N. (2020). Board gender diversity, corporate governance, and earnings management: Evidence from an emerging market. Gender in Management: An International Journal, 35(1), 37-60.
Oshim, J. C., & Igwe, A. O. (2024). Corporate governance and financial performance of listed consumer goods firms in Nigeria. International Journal of Business and Management Review, 12(1), 96-115.
Sharma, N. (2017). Corporate governance mechanisms in India. International Journal of Advanced Research and Development, 2(5), 1-6.
Sundvik, D. (2019). The impact of principles-based vs. rules-based accounting standards on reporting quality and earnings management. Journal of Applied Accounting Research, 20(1), 78-93.
Susanto, Y. K., & Pradipta, A. (2016). Corporate governance and real earnings management. International Journal of Business, Economics and Law, 9(1), 17-23.
Warrens, B. A. (2021). Corporate governance and earnings management: A comparative analysis of Nigeria and Ghana. International Journal of Economics, Business and Management Research, 5(4), 186-207.
Wasan, P., & Mulchandani, K. (2020). Corporate governance factors as predictors of earnings management. Journal of General Management, 45(2), 71-92.
Downloads
Published
Issue
Section
License
Copyright (c) 2026 This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International License, which permits unrestricted use, distribution, adaptation, and reproduction in any medium, provided that the original work is properly cited.
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Authors are permitted to post their work online in institutional/disciplinary repositories or on their own websites. Pre-print versions posted online should include a citation and link to the final published version in Journal of Librarianship and Scholarly Communication as soon as the issue is available; post-print versions (including the final publisher's PDF) should include a citation and link to the journal's website.
