CORPORATE TRANSPARENCY AND FIRM VALUE OF QUOTED NON-FINANCIAL FIRMS IN NIGERIA
Keywords:
Corporate transparency, financial transparency, firm value, governance transparency, market capitalizationAbstract
Due to issues with corporate transparency in Nigeria, the Securities and Exchange
Commission decided to include disclosure and transparency in its code of
governance framework in 2018 in line with global best practices to improve investors’
confidence and help resuscitate declining firm value due to lack of investors’ confidence
that results from lack of detailed information. Hence, the study examined the effect of
corporate transparency among public listed non-financial firms with specific focus on
financial, governance, operational and social transparency. The study population consist of
107 non-financial firms quoted on the Nigeria Exchange Group as of December 31st, 2021
of which 67 were sampled. Secondary data obtained from the companies’ annual reports
spanned through 2011 to 2021 and was analysed using panel data regression technique.
The findings revealed that financial transparency, operational transparency and social
transparency are of positive and significant effect on firm value while governance
transparency have negative and insignificant effect on firm value. The study then concluded
that regulators of the Nigeria capital market could make it more efficient and attractive for
investors by enforcing transparency, which is an important underlying aspect that can affect
value of firm and improve its overall market capitalization. It recommended that regulators
should insist on more transparency to help investors seeking capital gain assess true
financial status of the company and improve the firm value.