Enhancing the Performance of Consumer Goods Firms through the Equity Capital in Nigeria (2011-2021)

Authors

  • Festus. Oladipupo Olaoye Department of Accounting, Ekiti State University, Ado-Ekiti, Nigeria
  • Ayoola Azeez Olaoye Department of Accounting, Ekiti State University, Ado-Ekiti, Nigeria

DOI:

https://doi.org/10.30564/jsbe.v5i4.27

Abstract

This study examined whether or not equity capital enhances the performance of listed consumer goods firms in Nigeria. The study purposively sampled fourteen (14) out of twenty-one (21) consumer goods firms listed on the Nigerian Exchange Group Plc. The study used secondary sources to obtain panel data from the annual financial statements of the selected companies. Data sourced for were analyzed using random effects model and arithmetical means. Findings from the study revealed that the coefficient of share capital is positive (0.903050) and statistically significant (p=0.0099<0.05), but the beta value of retained earnings is negative (−0.683966) and significant (p=0.0023<0.05) for listed consumer goods firms in Nigeria. The average results found that 45% and 7% of total assets of the firms were financed by retained earnings and share capital respectively. The study confirmed that the appropriate mode of finance that could be considered for the effective performance of the firms in Nigeria is the share capital. The study concluded that share capital enhanced the performance of firms while the retained earnings did not in the country. The research recommended that the government of Nigeria should try to rebrand its dead local enterprises especially the affected consumer goods firms to enable them to attract more foreign investors into the country to enhance its economic growth.

Keywords:

Consumer goods firms, Equity capital, Performance

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How to Cite

Olaoye, F. O., & Olaoye, A. A. (2022). Enhancing the Performance of Consumer Goods Firms through the Equity Capital in Nigeria (2011-2021). Journal of Sustainable Business and Economics, 5(4), 22–30. https://doi.org/10.30564/jsbe.v5i4.27

Issue

Vol. 5 , Iss. 4 (October 2022)

Article Type

Article

License

Copyright © 2022 Festus. Oladipupo Olaoye, Ayoola Azeez Olaoye

Creative Commons License

This is an open access article under the Creative Commons Attribution 4.0 International License.