EFFECT OF DIRECTOR’S TUNNELLING ON FIRM PERFORMANCE OF QUOTED COMPANIES IN NIGERIA
*Nnubia, Innocent Chukwuebuka & Fabian C. Obiora
Department of Accountancy
Chukwuemeka Odumegwu Ojukwu University, Anambra State
Email: nnubiae@yahoo.com, oniiudochiobiora@gmail.com
*Corresponding author
ABSTRACT
The study investigates the effect of director’s tunnelling on firm performance of quoted companies in Nigeria. A sample of 15 Nigerian consumer goods firms listed on Nigerian Stock Exchange for a period of 8 years (from 2010-2017) was selected. The main type of data used in this study is secondary; sourced from the Nigerian stock exchange fact book. This study applied ex post facto research design. The data collected were analyzed using Ordinary Least Square Method. The results show that for the Nigerian listed consumer goods firms, the explanatory variables- Chairman’s pay and Director’s equity holding has negative significant effect on the dependent variable – asset utilization (Performance); whereas Board of director’s pay is positive and has no significant impact on the asset utilization (Performance). The study, therefore recommends among others that the chairman and other board member pay should not be fix by the CEO rather it should be fixed by the entire shareholder during the annual general meeting to reduce the influence of the CEO and the give and take politics of the board.
Key words: director’s tunnelling, firm performance, asset utilization, Nigeria.
