Evaluation of the Moderating Effect of Corporate Board on Corporate Performance and Directors Tunneling in Listed Pharmaceutical Organisations in Nigeria

Abstract

This study evaluates the moderating effect of corporate board on corporate performance and directors tunneling in listed pharmaceutical organizations in Nigeria. The study used panel data collected from annual financial report of listed pharmaceutical organizations in Nigeria between 2015 and 2019. Board independence, board effectiveness, board expertise, firm performance, and directors tunneling were used as variables. The study adopted the ex-post-facto research design and the data collected were analysed using regression analysis, however some preliminary analysis like descriptive statistics, correlation analysis was carried out. The study finds that moderating role of corporate performance on board independence has negative and significant effect on director's tunneling. The moderating role of corporate performance on board effectiveness has negative insignificant effect on director's tunneling. The moderating role of corporate performance on board members expertise has insignificant effect on corporate tunneling. This reveals the extent the effect of corporate board attributes on tunneling activities among pharmaceutical organizations can be moderated by the level of performance. The study recommends that policy maker among pharmaceutical organizations should pay close attention to the performance of their organizations when formulating policy that will be geared toward enhancing board monitoring and control role toward reducing the possibility of corporate tunneling.