Corporate Boards and Leverage Decisions

ABSTRACT

This study explores how leverage decisions of firms are influenced by the boards of directors of 129 listed firms on the Nigerian Exchange, over a period of five (5) years (2017 to 2021).     Leverage decisions are measured by total liabilities to total assets, while corporate boards are measured by board independence, board female gender, board size, board meetings and board ownership. After firm size and audit quality are controlled, we find that board female gender and board size negatively and significantly influence the degree of leverage among listed firms in Nigeria. However, we document that board independence, meetings and ownership are not significant in relation to leverage decisions. These findings suggest that both board female gender and board size are important. These results are important to regulators, boards of directors, board committees, market participants, lenders, shareholders, managers, employees, suppliers, and customers. The study is limited by the number of samples. It is expected that further research can increase the total sample of companies by adding to the research period or using all the 156 listed firms on the Nigerian Exchange.