Corporate Governance Quality, Agency Cost and Shareholder Investment in Nigerian Consumer Products Companies

Abstract

This study is anchored on Nigerian consumer products companies that are traded on the Nigerian Stock Exchange. This research investigates the connection between Corporate Governance quality, Agency cost, and Investment choice. Tobin's Q, Audit Committee, Board size, Board independence, Operational Expenses, and Asset Utilization Ratio data were taken from yearly reports of 10 chosen firms over an 11-year period between 2011 and 2021 to determine the connection. The OLS panel model regression's findings indicated that the value of the t-statistics computed for Audit Committee and Board Size was below the crucial value of 5%. This suggested that the Audit Committee had influence over the choice to invest in the chosen consumer goods firms. Asset usage ratio, Operating Expenses Ratio, and T-statistics for Board Independence all exceeded the crucial figure of 5%. This suggested that the Audit Committee's influence on the chosen consumer goods firms' spending decisions is minimal. The study's conclusion was that consumer products firms must have an ideal board structure if they want to perform better.