Examining the Influence of Risk Management Committee Dynamics on Financial Performance: A Case Study of Listed Insurance Companies in Nigeria
A.R. Ayeni Agbaje
Department of Accounting, Faculty of Management Sciences, Ekiti State University Ado-Ekiti, Ekiti State, Nigeria.
I. A. Adebayo
Department of Accounting, Faculty of Management Sciences, Ekiti State University Ado-Ekiti, Ekiti State, Nigeria.
Roseline Osatohanmwen. Adeboboye *
Department of Accounting, Faculty of Management Sciences, Federal University Oye-Ekiti, Ekiti State, Nigeria.
*Author to whom correspondence should be addressed.
Abstract
The Nigerian insurance industry has experienced substantial growth due to factors like increased awareness, regulatory reforms, and technological advancements. This research aimed to explore how the composition, structure, and activities of risk management committees influence key financial performance metrics, focusing on return on assets (ROA). Data from annual reports and audited financial statements of selected insurance companies listed on the Nigerian Exchange Group from 2013 to 2022 were analyzed using both descriptive and inferential statistics. The study revealed that risk management committee size and meeting frequency positively impact financial performance, suggesting that larger committees and more frequent meetings correlate with better financial outcomes. However, factors like committee independence and gender diversity had insignificant effects on financial performance. In conclusion, the presence and effectiveness of risk management committees significantly affect the financial performance of listed insurance companies in Nigeria. The study recommends that insurance companies prioritize diverse committee compositions to benefit from a wider range of expertise and perspectives.
Keywords: Financial performance, risk management committee, risk committee size, risk committee meetings, risk committee independent, risk committee gender diversity