TOP MANAGEMENT STRUCTURAL FRAMEWORK AND TAX OPTIMIZATION EVIDENCE FROM LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA
Abstract
This study examines the relationship between top management structural framework and tax optimization among listed non-finance firms in Nigeria, with tax avoidance referring to the legal strategies employed by firms to minimize their tax liabilities. Drawing from agency theory, this study investigates how governance attributes—such as board size, board independence, board gender diversity, and board diligence—affect tax optimization practices. The study fills gaps in existing literature by focusing on Nigeria's unique economic, regulatory, and cultural context. Utilizing a mixed effect multilevel regression analysis, this study analyses data from eleven (11) industrial goods firms over a ten-year period (2014-2023). Findings reveal a positive effect of board size on tax optimization, suggesting that larger boards enhance firms' strategic capabilities in minimizing tax liabilities, while board independence, gender diversity, and diligence show no significant effects. The results contribute to the debate on the role of corporate governance in aggressive tax optimization and accentuate the need for policymakers to develop comprehensive tax governance frameworks that promote oversight, transparency, and ethical corporate tax practices. This study highlights the importance of contextual and firm-specific factors in shaping tax avoidance behaviors and provides valuable insights for stakeholders aiming to balance effective governance with sustainable tax practices in emerging markets like Nigeria.
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Published in JOURNAL OF ACCOUNTING AND BUSINESS
ISSN: 1596-9912
This article appears in our peer-reviewed academic journal
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