Corporate governance and capital structure: evidence from listed firms in Nigeria stock exchange

ABSTRACT This study examined the relationship between corporate governance and capital structure decisions of listed firms in Nigeria. To achieve the objectives of this study, a total of 40 listed firms in the Nigerian stock exchange market were selected and analyzed for the study. The choice of the selected firms’ arises based on the capital structure and the availability of data for the listed firms. Also, the corporate annual reports for the period 2006-2011 were used for the study. The study was basically modeled to examine the relationship between corporate governance and capital structure decisions of listed firms operating in the Nigerian stock exchange market using the regression analysis method. The study in its findings observed that there is a significant positive relationship between CEO duality and the capital structure of listed firms in Nigeria.  In addition, it observed that board size, management ownership and board composition had a significant negative impact on the capital structure decisions firms’ in Nigeria. The paper therefore concludes that as the level of managerial ownership increases, firm control passes from external shareholders to the managers and after a certain period of managerial ownership, managerial entrenchment leads to debt avoidance