EFFECT OF CORPORATE GOVERNANCE ON CAPITAL STRUCTURE DECISIONS OF LISTED MULTINATIONAL COMPANIES IN NIGERIA

Abstract

There has been a persistent issue regarding multinational companies' unexpected collapse and losses due to the lack of proper Corporate Governance structure. The main objective of the study is to examine the effect of corporate governance on capital structure decisions of listed multinational companies in Nigeria. The study used ex-post facto research design to examine the relationship between corporate governance on capital structure decisions of listed multinational companies in Nigeria from 2019 to 2023 with study population of 11 and all were used by by adopting census sampling technique. Data was obtained from audited reports and analyzed using descriptive statistics and panel least squares regression with a 5% significance level. The findings show that board composition and board size have positive and significant effect on the capital structure decisions of listed multinational companies in Nigeria while board meetings have positive and insignificant effect on the capital structure decisions of listed multinational companies in Nigeria. The study recommends that companies should enhance their board activities and engagement, as active board compositions have a positive impact on capital structure decisions. More engaged and diligent boards can lead to better financial decision-making. Additionally, companies should assess their current board size and consider expanding it if it is currently small. Larger boards tend to have a more significant and favorable effect on capital structure decisions. However, it is essential to optimize board size to maintain efficiency and avoid potential issues related to coordination and decision-making complexities