Moderating Role of Firm Size in the Relationship Between Corporate Governance Characteristics and Financial Reporting Quality of Listed Industrial Goods Companies in Nigeria.

Abstract

This study examines the relationship between board gender diversity, frequency of board meetings, firm size, and financial reporting quality in listed industrial goods companies in Nigeria. The primary objective is to investigate how board characteristics, along with the moderating effect of firm size, influence the quality of financial reporting. The research adopts an ex-post facto design, using secondary data from 13 industrial goods companies listed on the Nigerian Exchange Group (NGX) for the period 2013-2023. A fixed effect model regression was used to analyze panel data, combining both time-series and cross-sectional data. The findings reveal that board gender diversity significantly improves financial reporting quality, whereas the frequency of board meetings does not have a significant direct impact. Firm size was found to significantly moderate the relationship between board gender diversity and financial reporting quality, as well as the relationship between the frequency of board meetings and financial reporting quality. Larger firms leverage their resources to enhance the effectiveness of board diversity and meeting frequency. Based on the findings, it is recommended that companies actively promote gender diversity within their boards and ensure that board meetings are structured and focused on key financial issues. Additionally, larger firms should use their size advantage to optimize board diversity and meeting frequency. Further research is encouraged to explore the moderating effects of firm size in greater detail across various industries.