Corporate Board Characteristics and Tax Aggressiveness: A Study of Manufacturing Firms in Nigeria

ONATUYEH ARUOBOGHA EDWIN; Dr. Odu Victor

Volume : VIII, Issue : IV, April - 2019

Corporate Board Characteristics and Tax Aggressiveness: A Study of Manufacturing Firms in Nigeria

Onatuyeh Aruobogha Edwin, Dr. Odu Victor

Abstract :

The concept of corporate tax aggressiveness has received immense empirical investigation in the developed countries of Europe and America. However, the association of the concept with corporate board characteristic has not been sufficiently explored in literature. This study therefore seeks to provide empirical evidence on whether corporate board characteristics such as board size, board gender diversity, and board independence are significantly associated with tax aggressiveness amongst manufacturing firms in Nigeria. Leaning on the agency theory and to achieve the above objective, a sample of forty-nine (49) manufacturing firms listed on the Nigeria stock exchange (NSE) as at December 2016 was examined. Data for the study were obtained solely from annual financial statements of the studied firms for the period 2011 to 2016. The econometric model adopted for the study was estimated using panel data regression approach with a preference for the fixed effect model based on the result of the Hausman test. Results of the study show that both board size and board independence exert negative and significant impacts on tax aggressiveness in manufacturing firms in Nigeria, while board gender exerts no significant effects. The insufficient women corporate board membership in the firms is assumed to be a plausible reason for this outcome. In light of the findings of the study, we therefore, recommend that listed manufacturing firms in Nigeria should ensure more women are included in their boards of directors.