TITLE:
Risk Committee Effectiveness and Financial Performance Indicator of Quoted Firms in Selected African Countries
AUTHORS:
Augustine Chukwujekwu Odubuasi, Nkechi Theresa Ofor, Andrew Ugbah
KEYWORDS:
Risk Committee Diligence, Risk Committee Composition, Risk Committee Gender Diversity, Risk Committee Expertise, Risk Committee Size
JOURNAL NAME:
Journal of Financial Risk Management,
Vol.11 No.3,
August
30,
2022
ABSTRACT: The rise in contemporary risk and the resultant
corporate failures has necessitated the need for the required attributes of
risk committee that would minimize risk of firms. To this end, this study was
set to find out the effect of risk committee effectiveness (RCE) on financial
successes of quoted banks in selected three African countries. The study
spanned from 2009 to 2018. The study focused specifically on risk committee
diligence, committee composition, committee diversity, committee expertise,
committee size and return on equity (ROE) of the countries selected from Africa
namely Nigeria, South Africa and Ghana. More so, we controlled for financial
leverage. Ex post facto research design was adopted for the study and panel
data in relation to the study were sourced from the annual reports of the
chosen banks in the selected countries. The study patterned after the fixed
effect model (FEM) since the Hausman test supports the FEM. The FEM reported
that the effect of RCE diligence and RCE compositions on bank performance in
Nigeria, South Africa and Ghana is highly significant statistically at 5%
level. Hence, the study concludes that RCE vis-à-vis risk committee diligence,
committee compositions and leverage factors should be pivotal to the
formulation of risk management committee of organisations.