Does compliance matter in surveillance of Nigerian banks? A critical examination of the Central Bank of Nigeria code of corporate governance

S. R. Abdullahi, Mas’ud Usman Ibrahim

Research output: Chapter in Book/Report/Conference proceedingConference proceedingpeer-review


Purpose – This paper assesses whether or not banks in Nigeria comply with the provisions of Central Bank of Nigeria’s Code of Corporate Governance (CBN CCG) issued in 2006 and discusses the potential implications of compliance for a proposed Basel III framework. Design/methodology/approach – A sample of fifteen banks selected from the entire 22 listed banks in Nigeria was critically analysed based on compliance index developed from 2007 to 2011(post-CBN CCG period). Findings – The results indicate that average compliance level with the CBN CCG 2006 of all the banks within the period is 65% suggesting lack of full compliance with the code. Research limitations/implications – Compliance in the context of the Nigerian banks entails a strict adherence with all the code of corporate governance provisions stipulated in such a manner that no requirement is left unobserved. Further research investigating key determinants of compliance/non-compliance to the CCG is very crucial in understanding the context of compliance with CCG. Practical implications – Despite the evidence showing positive association between compliance with CCG and investor confidence, there is no evidence that Nigerian banks appreciate the value of such compliance. The results of this study imply a serious negative ramification on the compliance level with the Basel III and potential loss of confidence of international investors. Originality/value – The essence of compliance to boosting investor confidence is paramount in emerging world particularly with the recent accounting scandals that reshape our views of various aspects of CG. No any framework for measuring compliance is in place by the central bank. Therefore this study establishes a pragmatic framework that will assess the degree of compliance by the Nigerian banks with a view to ensuring safeguard of the depositors’ funds and re-building investors’ confidence in the Nigerian financial system particularly in the aftermath of the financial crisis that negatively affected banks across the globe. This measurement yardstick will also help in periodic assessment of compliance with other rules such Basel III. JEL Classification: DO4, FO1, F4, G2, G3
Original languageEnglish
Title of host publicationUnknown Host Publication
Publication statusPublished - 2015
Event5th Annual Conference of African Accounting and Finance Association - University of Mauritius, Mauritius
Duration: 2 Sept 20154 Sept 2015


Conference5th Annual Conference of African Accounting and Finance Association

Bibliographical note

The full text is currently unavailable on the repository.


  • Code of corporate governance
  • compliance index
  • financial regulation
  • banks
  • investor confidence
  • Basel III


Dive into the research topics of 'Does compliance matter in surveillance of Nigerian banks? A critical examination of the Central Bank of Nigeria code of corporate governance'. Together they form a unique fingerprint.

Cite this