ABSTRACT
This
study examined the effect of directors’ tunneling on assets utilization in
Nigerian manufacturing sector. The study employed ex post facto research
design. Data for analysis was gotten from the published financial reports of 14
listed manufacturing firms spanning a period of 5 years (2015 to 2019). The
multiple linear regression model using Panel data regression technique was used
to analyze the data generated with the aid of Econometric View (E-View Version
9). Findings from the study revealed that directors’ pay has a positive insignificant effect on asset
utilization of listed manufacturing firms in Nigeria. Further
findings revealed that concentrated
ownership has a positive insignificant effect on asset utilization of listed
manufacturing firms in Nigeria and finally, it was revealed that managerial
ownership has a negative insignificant effect on asset utilization of listed
manufacturing firms in Nigeria. Based on the findings the study
recommends that, listed
manufacturing firms should develop a policy that continuously fix directors’
pay at a level it will not encourage tunneling. In line with the agency theory,
directors interest should be protected through setting adequate pay package for
them that will spur their performance but discourage tunneling activities.
Also, that more shares be appropriated to
managers such that their bonuses be paid through share allotment. This will enable the managers interest be
tied to that of the firm since they form part of the owners of the firm thus
will instigate a drive for them to properly utilize the assets of the firm.
Lastly, it is recommended that majority of shares be allotted to competent
shareholders. This will further encourage adequate utilization of the firms
asset and discourage tunneling activities by such concentrated owners of
shares.
MICHAEL, U (2023). Effect Of Directors Tunneling On Assets Utilization In The Nigerian Manufacturing Sector. Repository.mouau.edu.ng: Retrieved Dec 09, 2024, from https://repository.mouau.edu.ng/work/view/effect-of-directors-tunneling-on-assets-utilization-in-the-nigerian-manufacturing-sector-7-2
UNIVERSITY, MICHAEL. "Effect Of Directors Tunneling On Assets Utilization In The Nigerian Manufacturing Sector" Repository.mouau.edu.ng. Repository.mouau.edu.ng, 04 Jul. 2023, https://repository.mouau.edu.ng/work/view/effect-of-directors-tunneling-on-assets-utilization-in-the-nigerian-manufacturing-sector-7-2. Accessed 09 Dec. 2024.
UNIVERSITY, MICHAEL. "Effect Of Directors Tunneling On Assets Utilization In The Nigerian Manufacturing Sector". Repository.mouau.edu.ng, Repository.mouau.edu.ng, 04 Jul. 2023. Web. 09 Dec. 2024. < https://repository.mouau.edu.ng/work/view/effect-of-directors-tunneling-on-assets-utilization-in-the-nigerian-manufacturing-sector-7-2 >.
UNIVERSITY, MICHAEL. "Effect Of Directors Tunneling On Assets Utilization In The Nigerian Manufacturing Sector" Repository.mouau.edu.ng (2023). Accessed 09 Dec. 2024. https://repository.mouau.edu.ng/work/view/effect-of-directors-tunneling-on-assets-utilization-in-the-nigerian-manufacturing-sector-7-2