BOARD HETEROGENITY AND FINANCIAL REPORTING QUALITY OF LISTED CONSUMER GOODS FIRMS IN NIGERIA

Abstract

This study investigated the impact of board heterogeneity on the financial reporting quality of listed consumer goods firms in Nigeria between 2010 and 2024. Employing an ex-post facto research design and utilizing panel data, the study tested hypotheses concerning the influence of various board characteristics on financial reporting quality. The findings reveal that board size, board financial expertise, and board age significantly affect financial reporting quality, while board gender diversity shows an insignificant relationship with financial reporting outcomes. Based on these results, the study recommends that regulatory bodies such as the Financial Reporting Council of Nigeria (FRCN) and the Securities and Exchange Commission (SEC) enhance corporate governance policies by focusing not only on increasing board diversity but also on improving the functional involvement and accountability of board members. It further suggests the introduction of robust monitoring and evaluation systems to assess the actual contributions of diverse boards. Additionally, since larger boards were linked to reduced financial reporting quality, firms are advised to avoid unnecessarily large boards, which may impede effective communication and reduce accountability. Instead, companies should aim for an optimal board size that ensures a balance between diversity, strategic agility, and operational efficiency.