College of Management and Social Sciences

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Author: search.filters.author.Ojeka Stephen A.End date: 2019

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    Chief financial officer roles and enterprise risk management: An empirical based study
    (Heliyon, 2019) Ojeka Stephen A.; Adegboye Alex; Adegboye Kofo; Alabi Oluwaseyi; Afolabi Mosinmileoluwa; Iyoha Francis
    This study investigates the influence of CFO roles on the implementation of ERM initiatives in a sample of Nigerian financial institutions (between 2013-2017). We develop three distinct factors representing the CFO roles namely CFO power, CFO experience and CFO knowledge using principal component factoring. Like prior work, we measure ERM components simultaneously to capture the extent of sophisticated ERM system. Our findings pose that the CFO involvement in ERM implementation remains minimal while the CRO is solely responsible for ERM implementation, which could undermine cost-benefit effectiveness. Our empirical evidence reports that the sophisticated ERM only promote the market evaluation while the accounting performance is undermined. The result then contravenes the expectation that effective ERM enhances accounting performance by mitigating risk exposure. While the sophisticated ERM is significantly positive with leverage, which reveals that ERM implementation does not necessarily reduce the firm risk. This indicates that the ERM implementation remains ineffective to mitigate risks, where the CFO involvement in the ERM initiative is limited. We then advocate that CFOs should be allowed to contribute strongly on some specific aspects of ERM initiatives namely identification and analysis of key risk indicators, the financial implication of risks and integration of ERM into traditional finance activities.
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    DOES CEOs POWER MODERATE THE EFFECT OF AUDIT COMMITTEE OBJECTIVITY ON FINANCIAL REPORTING QUALITY IN THE NIGERIAN BANKING SECTOR?
    (Academy of Strategic Management Journal, 2019) Ojeka Stephen A.; Fakile Fakile; Iyoha Francis O.; Adegboye Alex; Olokoyo Felicia
    This study empirically examined the impact of audit committee objectivity (contingent on CEO Power) on the quality of financial reporting in the Nigerian Banking Sector. The study adopted a survey research approach and secondary data extracted from financial statement. The OLS and LSDV analysis were used to investigate the impact of Audit Committee objectivity on the quality of financial reporting with or without CEO power and influence. The findings showed, that, while audit committee independence impact positively on the relevance and reliability of financial report, the same cannot be said when there was CEO power. CEO power in the audit committee mitigated the benefits of independence and caused its overall effects on financial reporting quality of no significant in terms of relevance and reliability. The study therefore recommended that having a majority of independent directors would increase the quality of board oversight, lessen the possibility of damaging conflicts of interest and helps to repose inventors’ confidence especially foreign investors that would invariably draft in FDI. This will align boards’ decisions with the interests of shareholders they represent. This will reduce significantly the ability of the CEO overbearing influence on the committee activities in ensuring financial reporting quality.
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    Chief financial officer roles and enterprise risk management: An empirical based study
    (Heliyon, 2019) Ojeka Stephen A.; Adegboye Alex; Adegboye Kofo; Alabi Oluwaseyi; Afolabi Mosinmileoluwa; Iyoha Francis
    This study investigates the influence of CFO roles on the implementation of ERM initiatives in a sample of Nigerian financial institutions (between 2013-2017). We develop three distinct factors representing the CFO roles namely CFO power, CFO experience and CFO knowledge using principal component factoring. Like prior work, we measure ERM components simultaneously to capture the extent of sophisticated ERM system. Our findings pose that the CFO involvement in ERM implementation remains minimal while the CRO is solely responsible for ERM implementation, which could undermine cost-benefit effectiveness. Our empirical evidence reports that the sophisticated ERM only promote the market evaluation while the accounting performance is undermined. The result then contravenes the expectation that effective ERM enhances accounting performance by mitigating risk exposure. While the sophisticated ERM is significantly positive with leverage, which reveals that ERM implementation does not necessarily reduce the firm risk. This indicates that the ERM implementation remains ineffective to mitigate risks, where the CFO involvement in the ERM initiative is limited. We then advocate that CFOs should be allowed to contribute strongly on some specific aspects of ERM initiatives namely identification and analysis of key risk indicators, the financial implication of risks and integration of ERM into traditional finance activities.