Gender Diversity on Boards and Financial Performance in Emerging Markets: The Moderating Role of Directors' Remuneration in Nigeria

Corporate boardrooms are increasingly recognized as strategic platforms where gender diversity can enhance governance and financial outcomes. However, in emerging markets like Nigeria, the impact of board gender diversity on firm performance remains inconclusive, particularly in the absence of supportive governance mechanisms. This study examines the moderating effect of directors’ remuneration on the relationship between board gender diversity and the financial performance of listed consumer goods firms in Nigeria. Using panel data from sixteen firms over a ten-year period (2014–2023), this study applies Feasible Generalized Least Squares (FGLS) regression to analyze direct and moderated effects. Board gender diversity is measured through female board representation, female independent directors, and gender-based qualifications, while financial performance is proxied by Return on Assets (ROA). The results show that female board representation and female independent directors alone do not significantly affect financial performance. However, gender qualifications among female directors positively and significantly influence ROA. When moderated by directors’ remuneration, both female board representation and gender qualification exhibit a stronger positive effect on performance. In contrast, the interaction between female independent directors and remuneration remains statistically insignificant. The study concludes that gender diversity alone is insufficient to drive financial outcomes unless supported by professional competence and adequate remuneration. It recommends that listed firms prioritize the appointment of qualified women and ensure performance-based compensation to enhance board effectiveness. These findings offer important insights for improving governance practices and policy design in Nigeria’s consumer goods sector and similar emerging markets.