Empirical Analysis of the Relationship Between Corporate Governance Mechanisms and Firm Value Among Nigerian Listed Companies

The relationship between corporate governance mechanisms and firm value is a central question in corporate finance, yet its empirical characterisation in the Nigerian stock market context remains contested due to methodological limitations of existing studies. This study empirically analysed the relationship between corporate governance mechanisms and firm value among 60 companies listed on the Nigerian Exchange Group across banking, manufacturing, and services sectors for the period 2017 to 2023. Governance mechanisms operationalised included board size, board independence, CEO duality, audit committee effectiveness, ownership concentration, and institutional ownership. Firm value was measured by Tobin's Q and Price-to-Book ratio. Panel data regression using fixed effects and random effects estimators was employed, with the Hausman test determining model selection. Endogeneity was addressed through the generalised method of moments estimator. Results showed that board independence had a significant positive effect on Tobin's Q (coefficient = 0.214, p < 0.01), consistent with agency theory predictions. CEO duality was significantly negatively associated with firm value (coefficient = -0.187, p < 0.05). Audit committee effectiveness showed a significant positive effect on Price-to-Book ratio (coefficient = 0.143, p < 0.05). Ownership concentration had a non-linear relationship with firm value, with an optimal concentration level of approximately 42% beyond which value declined. The study fills important methodological gaps in Nigerian corporate governance-value research and recommends mandatory board independence requirements above 50% for all NGX-listed companies. Keywords: corporate governance, firm value, Tobin's Q, Nigerian Exchange Group, panel data