Privatisation and Corporate Governance Efficiency: Liquidity Ratio Assessment of the Nigerian Cement Industry

Jump To References Section

Authors

  • Bappayo Masu Gombe
     Senior Lecturer, Department of Economics, University of Abuja ,IN
  • Dahiru Hassan Balami
     Professor, Department of Economics, University of Maiduguri ,NG
  • Sule Magaji
     Professor, Department of Economics, University of Abuja ,NG
  • Ibrahim Musa
     Lecturer, Department of Economics, University of Abuja ,NG

DOI:

https://doi.org/10.18311/sdmimd/2022/30964

Keywords:

Cement Industry, Corporate Governance Efficiency, Liquidity Ratio, Privatization, Public Corporation

Abstract

The study examines how privatization affects public corporations’ corporate governance efficiency in the management of the liquidity ratio of the Nigerian cement industry. The observed variables are liquidity ratio and fourteen Corporate Governance proxies as dependent variables and independent variables. Secondary data were outsourced from the cement firms. Descriptive statistics and Pooled OLS regressions were used for analysis. Results suggest that the factors affecting corporate governance efficiency and causing capacity underutilization in the cement industry are macro-economic challenges and the weak private sector. The average total market value of shares, average foreign ownership, the average percentage of executive directors and average workforce has a positive impact on the Cement industry’s performance. However, privatization harms the performance of the company. Likewise, corporate governance has a significant impact on the liquidity ratio of the 1cement industry in Nigeria. The study recommends that corporate governance should reduce the liquidity ratios via long-term investment that will enhance return on investment. In addition, suggests devising strategies for proper liquidity and risk management to enhance financial performance and move towards sustainability and growth.

Downloads

Download data is not yet available.

Metrics

Metrics Loading ...

Downloads

Published

2022-09-01

How to Cite

Gombe, B. M., Balami, D. H., Magaji, S., & Musa, I. (2022). Privatisation and Corporate Governance Efficiency: Liquidity Ratio Assessment of the Nigerian Cement Industry. SDMIMD Journal of Management, 13(2), 41–49. https://doi.org/10.18311/sdmimd/2022/30964

Issue

Volume 13, Issue 2, September 2022

Section

Research Papers

License

Copyright (c) 2022 Bappayo Masu Gombe, Dahiru Hassan Balami, Sule Magaji and Ibrahim Musa

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

Crossref
Scopus
Google Scholar
Europe PMC

 

References

Allen, F. and Gale, D. (1999). Corporate governance and Competition. Wharton Financial Institute Centre. Working Paper Series, 99-28, University of Pennsylvania.

Bappayo, M. G. and Magaji, S. (2006). The effect of privatization on the development of Nigerian Capital Market. Journal of Research and Development in Africa. 5(1); 44–54.

Demsetz, H. and Lehn, K. (1985). The structure of corporate ownership: Causes and Consequences. Journal of Political Economy. 93:1155–77. https://doi.org/10.1086/261354

Garton, G. and Schmid, F. (2000). Universal banking and the performance of German firms. Journal of Financial Economics. 58. https://doi.org/10.1016/S0304405X(00)00066-0

Jamil S. A. and Omar J. A. (2021). The impact of credit risk management on the financial performance of the United Arab Emirates commercial banks. International Journal Of Research in Business and Social Science. 10(3):303– 19. https://doi.org/10.20525/ijrbs.v10i3.11022

Johnson, S., Boone, P., Breech, A. and Friedman. (2010). Corporate governance in the Asia Financial Crisis. Journal of Financial Economics. 58.

Keun, J. L. (2020). The effect of privatization and corporate governance of SOEs in transition economy: The case of Kazakhstan. ABD Working Paper 1127, Tokyo: Asian Development Bank Institute.

La Porta, R., Lopoz-de-Silanas, F., Shleif; A. and Vishney, R. W. (1999). Corporate ownership around the world. Journal of Finance. 54:471–517. https://doi.org/10.1111/0022-1082.00115

Madushanka, H. I. and Jathurika, M. (2018). The impact of liquidity ratios on profitability (With special reference to Listed Manufacturing Companies in Sri Lanka). International Research Journal of Advanced Engineering and Science. 3(4):157–61.

Magaji, S. and Musa, I. (2015). Endemic corruption and Nigeria’s underdevelopment. Abuja Journal of Business and Management. 1(4):119–25.

Mohammed, Т. A. (2020). The financial soundness of the Palestinian banking sector: An empirical analysis using the CAMEL system. International Research Journal of Advanced Engineering and Science. ISSN (Online): 2455-9024 157 K. https://orcid.org/0000-0002-79784359. Banks and Bank Systems, 15(1):85–97. https://doi.org/10.21511/bbs.15(1).2020.09

Muogbo, U. S (2013). Impact of privatization on corporate performance: A study of selected industries in Nigeria. International Journal of Humanities and Social Science Invention. 2(7):2319–722.

Munawar, et al. (2017). Limiting the reconstruction capability of generative neural network using negative learning. http://ieeexplore.ieee.org

Sunday, O. Y., Yusufu, A. I. and Abdullahi, M. H. (2022). Privatization and the efficiency of selected enterprises in Nigeria. Journal of Social Sciences Advancement. 3(1):20–5. https://doi.org/10.52223/JSSA22-030102-28