Moderating Effect of Intellectual Capital on the Relationship Between Corporate Governance and Market Value of Financial Firms in Nigeria

Abstract

This study investigates the moderating effect of intellectual capital on the relationship between corporate governance and the market value of financial firms listed on the Nigeria Exchange Group (NGX). Using an ex post facto research design, data were collected from 52 financial firms for the period 2014–2024, and analyzed using panel regression techniques. Corporate governance variables examined include board financial expertise, board independence, audit committee financial expertise, audit committee gender diversity, managerial ownership, and institutional ownership, while intellectual capital is conceptualized as a moderating factor. The findings reveal that board financial expertise, board independence, audit committee financial expertise, and institutional ownership significantly enhance market value, while audit committee gender diversity and managerial ownership exhibit positive but insignificant effects. Intellectual capital was found to have a significant positive impact on market value and strengthens the effect of board financial expertise, indicating that knowledge-based resources amplify the effectiveness of governance mechanisms in driving firm performance. The study concludes that effective corporate governance, when complemented by robust intellectual capital, is essential for enhancing market value and investor confidence in Nigerian financial firms. It recommends that firms strengthen board and audit committee expertise, promote intellectual capital development, and encourage active institutional ownership to maximize governance effectiveness and sustainable value creation.