Chief Executive Officers’ Attributes and Firms’ Value of Deposit Money Banks in Nigeria

Abstract

The chief executive officer adds to the firm’s worth as a key member of the senior management team. Using samples from deposit money banks listed on the Nigerian Exchange Group floor between 2013 and 2022, this study investigated the relationship between CEO characteristics and the firm’s value. The independent variable, Chief Executive Officers' attributes, had the CEO’s educational background, tenure in office, compensation, and gender diversity as proxies, all of which were in accordance with the principles of upper-echelon theory, which holds that businesses are reflective of the cognitive behaviours of the CEO. Firm value as determined by market capitalization served as the dependent variable. The ex post facto research design was used, and the population of this study comprised all the 13 deposit money banks listed on the floor of the Nigerian Exchange Group as of 31st December 2022. Four hypotheses were tested at the 0.05% significance level using the ordinary regression technique. The statistical package used was STATA 16, and the analysis results showed that CEO attributes have significant positive effects on the firm value of listed deposit money banks in Nigeria. Therefore, it was concluded that CEO attributes significantly affect the value of listed deposit money banks in Nigeria. It was recommended, among others, that deposit money banks should appoint CEOs with postgraduate or professional qualifications, as higher academic qualifications come with expertise and a wealth of knowledge that help the firms to be more prolific in performance.