BOARD CHARACTERISTICS AND EARNINGS MANAGEMENT OF LISTED CONSUMER GOODS FIRMS IN NIGERIA

Abstract

This study examines the effect of board characteristics on earnings management of listed consumer goods companies in Nigeria for the period 2015–2024. The specific board attributes consider board competency, frequency of board meetings, gender diversity, and board size, while earnings management serves as the dependent variable.
The study is anchored on Agency Theory, which explains how corporate governance mechanisms are used to mitigate conflicts between managers and shareholders. The population of the study comprises 21 consumer goods firms listed on the Nigerian Exchange Group (NGX) as at 31st December 2024. However, a sample of 17 firms was selected using a purposive sampling technique. The study relies on secondary data obtained from audited financial statements of the sampled firms. Methodologically, a correlational research design was adopted. The data were analyzed using Panel- Corrected Standard Errors (PCSE) regression technique implemented via STATA 17 version. The findings reveal that board competency and frequency of board meetings have negative but statistically insignificant effects on earnings management. Gender diversity has a positive and statistically significant effect, while board size has a negative and statistically significant effect on earnings management. The study concludes that board characteristics exert mixed influences on earnings management and recommends strengthening board effectiveness, especially through improved competence, meaningful participation of female directors, and optimal board size.