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Audit committee attributes and bank performance in Africa

Umar Habibu Umar (Department of Accounting, Yusuf Maitama Sule University Kano, Kano, Nigeria)
Jamilu Sani Shawai (Department of Internal Audit, Kano University of Science and Technology, Wudil, Nigeria)
Anthony Kolade Adesugba (Department of Business Administration, Ahmadu Bello University Faculty of Administration, Zaria, Nigeria)
Abubakar Isa Jibril (Office of the Accountant General of the Federation, Abuja, Nigeria)

Corporate Governance

ISSN: 1472-0701

Article publication date: 16 February 2024

Issue publication date: 27 August 2024

312

Abstract

Purpose

This study aims to evaluate how audit committee (AC) characteristics affect the performance of banks in Africa.

Design/methodology/approach

The authors manually generated unbalanced panel data from 78 commercial banks operating in twelve (12) countries whose annual reports were published on the website of African Financials between 2010 and 2020.

Findings

The results indicate that AC size has an insignificant positive association with bank performance (return on equity and Tobin’s Q). AC independence has a significant positive association with bank performance. However, AC gender diversity has a significant negative association with bank performance. Besides, AC financial expertise has a significant positive and negative association with return on equity and Tobin’s Q, respectively.

Research limitations/implications

The study considered only 78 banks that operate in twelve (12) African countries. Besides, the authors consider only four (4) AC attributes.

Practical implications

The findings suggest the need to maintain a smaller AC, appoint more independent members to AC, reduce the number of women appointed to AC and ensure most AC members have financial expertise. These measures could improve bank performance in Africa.

Originality/value

Unlike previous African studies that are mostly restricted to a country level, the study examined how AC attributes influence the performance of banks that operate in Africa.

Keywords

Citation

Umar, U.H., Shawai, J.S., Adesugba, A.K. and Jibril, A.I. (2024), "Audit committee attributes and bank performance in Africa", Corporate Governance, Vol. 24 No. 6, pp. 1263-1282. https://doi.org/10.1108/CG-03-2023-0098

Publisher

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Emerald Publishing Limited

Copyright © 2024, Emerald Publishing Limited

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