International Journal of Economic Perspectives, 2017, Volume 11, Issue 1, 155-164.
International Journal of Economic Perspectives ISSN 1307-1637 © International Economic Society
http://www.econ-society.org
155
ABSTRACT
Recent corporate failures in the Nigerian Financial Sector and the resultant effect on the market performance of
listed firms necessitated the review of the existing codes of corporate governance in Nigeria. The research study
therefore explored the relationship between corporate governance mechanisms and market performance using four
corporate governance mechanisms variables as reviewed in the SEC Code 2011 and four market performance
variables. The four independent variables are audit committee independence, audit committee financial expertise,
board independence and ownership structure while the market performance indicators are Share Price (SP),
Volume of Trade (VOT), Market Capitalization (MC) and Earnings per Share (EPS). Empirical analysis was
carried using correlation, regression and two independent T-tests. The result showed that there is a positive
significant impact of audit committee independence, audit committee financial expertise, board independence as
revised in the SEC Code 2011 on SP, VOT, MC and EPS. This study recommends that there is need for Policy
makers to strengthen the implementation of every recommendation contains in the SEC Code 2011 to further
stabilize the performance of listed firms and also repose the confidence of investors both local and foreign investors
in the capital market. It is recommended that the provisions as contained in the SEC Code 2011 be backed up by
law to ensure strict compliance.
JEL Classification: M40; M41; M42.
Keywords: Corporate Governance; Share Price; Trade; Market Capitalization; SEC Code 2011; Nigeria.
*Corresponding author.
1. INTRODUCTION
Corporate governance has become a very critical issue in the running of business organizations (Adbullahi,
Enyinna, & Stella, 2010). There were times when the issue of corporate governance could not attract more than a
casual look. The recent happenings around the world and in Nigeria especially (collapse of energy corporation
Enron in 2001 in US, WorldCom, Global Crossing, Rank Xerox, Cadbury and some banks in Nigeria) have called
for closer looks at the tenets and the practice of corporate governance in the system. These include transparency,
accountability, responsibility, integrity, independence and discipline. Nigerian has had her fair share in the
business failures which have brought many firms and countries’ economies almost to its knees. The recent and
Does the Reformed Code of Corporate Governance 2011 Enhance
Market Performance of Firms in Nigeria?
Stephen A. OJEKA*
Department of Accounting, College of Business and Social Sciences, Covenant
University, Nigeria. Email: stephen.ojeka@covenantuniversity.edu.ng;
stojeka@yahoo.com. Tel: (+234) 0703 952 8774
Francis O. IYOHA
Department of Accounting, College of Business and Social Sciences, Covenant
University, Nigeria. Email: iyoha.francis@covenantuniversity.edu.ng;
iyohafrancis@yahoo.co.uk.
Ochei A. IKPEFAN
Department of Banking & Finance, Covenant University, Ota, Ogun State, Nigeria. E-
mail: ochei.ikpefan@covenantuniversity.edu.ng, ochei_ikpefan@yahoo.co.uk.
Chioma OSAKWE
Covenant University, Nigeria. Tel: (+234) 0817 113 8090.