BOARD DYNAMISM, FINANCIAL REPORTING QUALITY, AND FIRM SUSTAINABILITY OF QUOTED INDUSTRIAL GOODS IN NIGERIA

Abstract

This study examines the impact of board dynamics and financial reporting quality (FRQ) on firm sustainability within Nigeria’s industrial goods sector. It analyzes how board characteristics impact both FRQ and sustainability performance. The analysis was conducted using panel data, from eight firms listed on the Nigerian Stock Exchange, observed across a five-year period from 2020 to 2024. Data was analyzed using descriptive statistics, correlation analysis, and panel regression models (fixed-effects) to test the proposed relationships. The results revealed that board independence significantly enhanced sustainability performance, while gender diversity had a positive and significant influence on FRQ. Financial reporting quality itself exerted a robust effect on sustainability. Mediation analysis demonstrated that FRQ acts as a crucial partial mediator. Sub-sectorial comparisons highlighted notable disparities, with cement firms achieving higher average ESG scores than their chemical industry counterparts. The study recommends enforcing stronger governance policies mandating greater board independence and gender diversity to enhance transparency and bolster long-term resilience. This research provides empirical evidence on the mediating role of FRQ in the board-sustainability relationship, an area with limited research in emerging economies like Nigeria.