Enhancing corporate performance in Nigeria: the role of audit committee characteristics and corporate governance mechanisms / Mustapha Jamiu, Norfadzilah Rashid and Razana Juhaida Johari

As accounting scandals involving publicly traded corporations continue to emerge, skepticism about financial reporting grows globally. Despite audit committees on company boards, these scandals still impact company performance, raising concerns about the efficacy of audit committees. This research examined how characteristics of audit committees (ACs), such as gender diversity, membership tenure, share ownership, and leadership roles, influence the performance of publicly traded non-financial firms in Nigeria. Analyzing data from 73 companies on the Nigerian Exchange Group over 2015-2021, yielding 511 firm-year observations, the study employed advanced panel data methodologies like fixed effects and two-step GMM models. Results indicated that gender diversity within ACs and leadership positions significantly boosted corporate performance, while longer tenure and share ownership by AC members were linked to poorer performance. Company size, growth, and leverage also critically influence performance. This study enriches the discourse on corporate governance and AC efficiency within the Nigerian market, offering evidence-based insights for enhancing firm performance through strategic AC compositions. The findings suggest increasing female representation on ACs and managing AC member tenure and share ownership to bolster corporate success and stakeholder trust, underscoring the need for strengthened governance and oversight mechanisms.