Beyond the glass ceiling: How diverse boards drive financial performance, and why board size matters among Nigerian listed firms

The composition of corporate boards has long been a subject of intense scrutiny, yet the specific interplay between multidimensional diversity and financial performance within emerging markets remains underexplored. This study investigates the impact of board diversity, specifically gender, ethnicity, and age, and board size, on the financial performance of 151 firms listed on the Nigerian Exchange Group (NGX) over the period 2011 to 2025. Utilizing an ex-post facto research design and panel regression analysis, we examine Return on Assets (ROA), Return on Equity (ROE), and Tobin's Q as proxies for performance, while controlling for firm size, industry, and leverage. The findings reveal a nuanced relationship: gender diversity exhibits a positive but non-linear impact on accounting-based measures, while ethnic diversity significantly enhances market-based valuation (Tobin's Q), suggesting that investors in Nigeria value geopolitical representation. Age diversity emerges as a critical driver of stability, mitigating risk-averse behaviours common in family-dominated firms. Conversely, board size demonstrates a threshold effect; beyond a certain point, larger boards dilute accountability and hinder decision-making speed. These results challenge the one-size-fits-all approach to corporate governance codes, offering empirical evidence that diversity is not merely a compliance checkbox but a strategic asset. The study contributes to the Resource Dependence and Agency theories by contextualizing them within Nigeria's unique socio-cultural framework, providing actionable recommendations for regulators, investors, and corporate leaders aiming to optimize board efficacy.