Accounts

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Browsing Accounts by Author "Assenga, Modest P"

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    The Effects of Board Structure on the Firm Financial Performance of Tanzanian Listed Firms
    (Business Education Journal, 2021-07) Assenga, Modest P
    This paper examines the effects of the board structure variables of board size, outside directors and CEO duality on firm financial performance of the listed firms in Tanzania. This study uses a sample of listed Tanzanian firms from 2006 to 2018 and uses balanced panel data Ordinary Least Square (OLS) regression analysis of 120 firms-year observations obtained from the firms’ audited annual reports and the OSIRIS database. Furthermore, in order to address the endogeneity problem, this study uses the Random effect regression model and the Two Stage Least Square (2SLS) regression model as a robustness test. The results show that the smaller the board size with a higher proportion of outside directors and no CEO duality, the greater the firm’s financial performance. This study contributes to the understanding of the relationship between board structure and financial performance and it provides academic evidence to Tanzanian policy makers of current and future Corporate Governance reforms. First, dissimilar to most previous Corporate Governance literature that relates to developed countries, this study examines the effects of the board structure variables of board size, outside directors and CEO duality in Tanzania which is a developing country where very few Corporate Governance research studies have been conducted. It addresses the endogeneity problems between board structure and firm financial performance using Random effect regression and Two Stage Least Square (2SLS) regression models
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    Foreign Directors and Firm Financial Performance: Evidence from the Tanzanian Listed Companies
    (Business Education Journal, 2021-01) Assenga, Modest P
    This study investigates the impact of foreign directors on the financial performance of the Tanzanian listed firms. The study applies balanced panel data Ordinary Least Square (OLS) regression analysis on 120 firm-years observations obtained from the firms’ audited annual reports and from the OSIRIS database from 2006 to 2018. The study findings support agency and resource dependence theories that foreign directors have a positive relationship with the firms’ financial performance. The findings indicate further that foreign directors enhance firm performance by providing the firm’s Board of Directors with effective and efficient overseeing and advice to the CEO and the top management. This study contributes to the understanding of the impact of foreign directors on firm performance and provides researched based evidence to Tanzanian policy makers on the importance of foreign members on the firm’s Board of Directors. Unlike the previous corporate governance studies, which focused on developed countries, this study examines the effects of foreign members on the Boards of Directors of listed firms in Tanzania, a developing country where very few corporate governance studies have been conducted. The study recommends policy makers in Tanzania to use the results of this original study while preparing or reviewing Corporate Governance Regulations.
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    The Impact of Board Characteristics on the Financial Performance of Tanzanian Firms
    (Emerald Publishing Limited, 2018-03-31) Assenga, Modest P
    Purpose – This paper aims to investigate the impact of board characteristics on the financial performance of listed firms in Tanzania. Board characteristics, including outside directors, board size, CEO/Chair duality, gender diversity, board skill and foreign directors are addressed in the Tanzanian context by applying two corporate governance theories, namely, agency theory and resource dependence theory. Design/methodology/approach – The paper uses balanced panel data regression analysis on 80 firm-years observations (2006-2013) from annual reports, and semi-structured interviews were conducted with 12 key stakeholders. The study uses also a mixed methods approach and applies a convergent parallel design (Creswell and Plano Clark, 2011) to integrate quantitative and qualitative data. Findings – It was found that in terms of agency theory, while the findings support the separation of CEO/ Chairperson roles, they do not support outside directors-financial performance linkage. With regard to resource dependence theory, the findings suggest that gender diversity has a positive impact on financial performance. Furthermore, the findings do not support an association between financial performance and board size, PhD qualification and foreign directors. Practical implications – The study contributes to the understanding of board-performance link and provides academic evidence to policy makers in Tanzania for current and future governance reforms. Originality/value – The findings contribute to the literature by providing new and original insights that, within a developing setting, extend current understanding of the association between corporate governance and financial performance. This is predicated, also, on the use of uncommon mixed methods approach.