Developments in Value Creation and Appropriation of Nigerian Non-financial Quoted Companies

Abstract

This study examines the patterns and trends in the economic value created and appropriated by the Nigerian non-financial quoted companies over the years 1990-2012. The study uses panel data, collected from the audited annual financial statements of 68 out of 146 non-financial quoted companies in Nigeria. The study uses descriptive and inferential statistics such as percentages, measures of central tendency, graphs and trend analysis techniques to analyze the data. The study finds that employees captured the highest percentage (23.1 percent) of the economic value created by the companies, followed by government and shareholders in that order. In addition, the study finds significant positive relationship of time with value creation (β=0.347, P=.067), the value distributed to employees (β=0.656, P<.001) and community (β=0.005, P<.001) and the value retained (β=0.588, P<.001) by the companies. However, significant negative relationship of time with the value distributed to management executives (β=-0.068, P<.001) and non-significant relationship of time with the value distributed to shareholders (β=-0.041, P=.62), credit lenders (β=0.016, P=.72) and government (β=0.006, P=.97) were found. The study concludes that the companies’ prospects for increased value creation can be realized by distributing more economic value to employees and government and by retaining and engaging economic value in value adding activities.