MODERATING EFFECT OF BOARD GENDER DIVERSITY ON THE RELATIONSHIP BETWEEN OPERATIONAL AND LIQUIDITY RISK DISCLOSURE ON VALUE OF LISTED FINANCIAL COMPANIES IN NIGERIA

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Abstract

The study examined the moderating effect of board gender diversity on the relationship between operational and liquidity risk disclosure and value of listed financial companies in Nigeria  from 2014 to 2023. Utilizing a Generalized Method of Moments (GMM) approach, data was collected from 540 firm-year observations, covering operational risk disclosure, liquidity risk disclosure, and board gender diversity attribute. The findings indicate that board gender diversity significantly moderates the relationship between operational risk disclosure and firm value, enhancing firm performance. However, board gender diversity negatively moderates the relationship between liquidity risk disclosure and firm value, suggesting complexities in how diverse boards manage liquidity risk communications. The study concludes that board gender diversity plays a significant role in influencing how risk disclosures affect firm value. Specifically, while board gender diversity positively moderates the relationship between operational risk disclosure and firm value, it has a negative moderating effect on the relationship between liquidity risk disclosure and firm value. Therefore, the study recommends that to leverage the benefits of board gender diversity effectively, firms should invest in training programs that equip board members with the necessary skills to communicate risk disclosures clearly. These programs should emphasize effective decision-making processes and the importance of cohesive communication strategies, particularly in relation to liquidity risk management.