Female Directors’ Role on Capital Structure and Firm Performance Nexus: New Evidence from an Emerging Market - Nigeria

This study investigates the moderating role of female board directors on the relationship between capital structure and firm performance in Nigerian non-financial firms. The study builds on previous research that highlights the importance of gender diversity in corporate governance and its potential to enhance firm outcomes. Using data from 70 non-financial firms listed on the Nigerian Exchange Group from 2012 to 2021, the study applies the two-step system GMM approach to mitigate endogeneity issues. It focuses on various capital structure measures, such as debt-to-asset and debt-to-equity ratios, and examines their relationship with firm performance, with the presence of female directors as a moderating variable. The study finds that female directors moderate the relationship between capital structure and firm performance, improving the impact of debt levels on profitability while reducing market performance. This study contributes to literature by providing new evidence from an emerging market context on how board gender diversity influences financial decision-making and firm outcomes in Nigeria.