Board Diversity and Tax Avoidance of Listed Consumer Goods Firms in Nigeria
Abstract
The study examined the effect of board diversity on tax avoidance of listed Consumer goods firms in Nigeria. The specific objective was to ascertain the effect of board gender diversity and foreign directors on effective tax rate of listed Consumer goods firms in Nigeria. Ex-post facto research design was used in the study. Twenty-one listed consumer goods firms constituted the study population from which a sample of fifteen (15) firms was chosen. Secondary data were sourced from the annual reports of the sampled firms from 2014-2023, resulting in a ten (10) year data points. The analyses first underwent preliminary tests such as descriptive test, test of multicollinearity, test of normality, heteroskedasticity, linearity and autocorrelation before Robust Least Squares were used in the test of the hypotheses. The study found that board gender diversity has a significant negative effect on tax avoidance among listed consumer goods firms in Nigeria (? = 0.1257; p-value = 0.0397); foreign directorship has a significant negative effect on tax avoidance among listed consumer goods firms in Nigeria (? = 0.0950, p-value = 0.0142). In conclusion, greater diversity on boards could help mitigate aggressive tax avoidance practices and improve corporate governance standards in the consumer goods sector. The study recommends that firms should actively increase gender diversity on their boards as a strategy to reduce tax avoidance practices by ensuring a more balanced representation of women in boardrooms, which may promote ethical governance and discourage aggressive tax strategies.
Keywords
Board diversityBoard gender diversityForeign directorshipTax avoidance
References
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