CERTIFICATION

This is to certify that this research work titled Ethical Considerations in Corporate Governance:
A Survey of Governance Practices of Nigerian Banks was carried out by Ozurumba Uju
Nwadinma in partial fulfillment of the award of Masters in Business Administration Degree
(MBA Finance Specialisation) from the Faculty of Business Administration, University of Lagos
under my supervision.

………………………….. ……………………………

PROF. S.I OWUALAH Date

Project Supervisor

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 DEDICATION
This research work is dedicated to The Almighty God, my darling husband (Bar. Kingsley
Ozurumba) and my lovely children; Chelsea, Marion, Montell and Cherise.

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 ACKNOWLEGEMENTS.
I give all glory to God the giver and sustainer of life with whom all things are possible. He gave
me the strength and inspiration to pursue and complete this course without any problem.

I am particularly grateful to my course coordinator and project supervisor,Professor S.I Owualah

My profound gratitude goes to my husband Bar Kingsley Emeka Ozurumba who encouraged me
to undertake this programme and has been my greatest source of support in all my achievements
in life and also throughout the duration of this course.He remains my pillar of strength.I would
also like to appreciate my children Chelsea,Marion,Montell and Cherise for their corperation and
understanding while I was away for long hours studying for this programme.They are “my
everything”,my world.

I am deeply grateful to my parents Chief and Mrs Obi-Ezeh for bringing me into this
world;nurturing and supporting me to become the woman that I am today. My prayer as always
is that the Lord God will grant them many more years on earth to reap the fruits of their labour.

I cannot but mention my mother-in-law Lady Theresa Oroni Ozurumba of blessed memory for
her love, support and encouragement in the course of this programme. She was always there
helping out with children. I pray that God almighty grants her soul eternal rest.

Finally, I’m indebted to my friends (Ekene, Lizzy and Biodun) ,my cousin (Nnamdi) and my
daughter (Chelsea) for their prized contributions towards the completion of this project.

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 ABSTRACT
The objective of this paper, among others, is to examine ethical considerations in corporate
governance and carry out survey of governance practices of selected banks operating in Lagos
State of Nigeria. The study intends to determine the mindset of banking professionals on
contemporary ethical and corporate governance issues facing the Nigerian banking industry.
The banking reforms of 2009 initiated by the Central Bank Governor Mallam Sanusi Lamido
Sanusi necessitated a critical review of corporate governance practices in the industry with a
resolve to strengthen and revitalize the governance structures in the banking sector. This study
however reveals that tremendous progress has been made as regards instituting high ethical
standards and good governance practices in Nigerian banks. The study made use of both
primary and secondary data in order to ensure that the data obtained are sufficient for a
reasonable conclusion. The secondary data obtained from bank websites, CBN publications,
newspaper journals, articles and periodicals were used to complement the primary data
generated via the questionnaire. One hundred (100) questionnaires were retrieved from
respondents out of the One hundred and twenty (120) distributed. The hypotheses were analysed
using the Chi square analysis method. The study concludes that a healthy corporate governance
structure is imperative in the banking sector where retention of public confidence remains of
utmost importance. As such this study recommends further investment on ethics programmes and
ethics investigation models by stakeholders in the Nigerian banking industry.

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 TABLE OF CONTENTS

TITLE I

CERTIFICATION II

DEDICATION III

ACKNOWLEGEMENTS IV

ABSTRACT V

TABLE OF CONTENTS VI

LIST OF TABLES IX

CHAPTER ONE: INTRODUCTION

1.1 Background to the Study 2

1.2 Statement of Problem 4

1.4 Research Questions 8

1.5 Statement of Hypotheses 9

1.6 Significance of Study 10

1.7 Scope and Limitations of Study 10

1.8 Operational Definition of Terms 11

References 12

CHAPTER TWO: LITERATURE REVIEW

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2.1 Introduction 13

2.2 Brief Background of Corporate Governance 13

2.3 Defining and Understanding the Concept of Corporate Governance. 15

2.4 Theoretical Framework 17

2.5 Principles of Corporate Governance 22

2.6 Ethics and Ethical Principles in Business 23

2.7 Ethical theories 25

2.8 Legal and Ethical Compliance Mechanisms 30

2.9 The Practice of Corporate Governance in Nigeria. 33

2.10 The Nigerian banking system 34

2.10.1 Actors and their roles 37

2.10.2 Current Structure of Nigerian Banking System 39

2.10.3 Bank regulation and Supervision 41

2.11 Corporate governance: The Nigerian banking Industry Experience. 43

References 45

CHAPTER THREE: RESEARCH METHODOLOGY

3.1 Introduction 50

3.2 Research Design

3.3 Restatement of Research questions 50

3.4 Restatement of Research hypothesis 51

3.5 Characteristics of study population. 52

3.6 Sample Size and Sample Frame 52

3.7 Sampling technique 53

3.8 Instrumentation 53

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3.9 Method of Data Analysis 55

3.10 Limitations of the Methodology 55

References 56

CHAPTER FOUR: DATA ANALYSIS, PRESENTATION AND INTERPRETATION OF

4.1 Introduction 57

4.2 Questionnaire Response Statistics 57

4.3 Respondent Characteristics 58

4.4 Analysis of Responses according to Research Questions 62

4.5 Test of Hypotheses 73

References 86

CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATION

5.1 Introduction 88

5.2 Summary of Findings 88

5.3 Conclusion 89

5.4 Recommendations 90

5.5 Suggestions for Further Studies 91

References 92

Bibliography 93

Appendices 99

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 LIST OF TABLES

Table 1: Historical Review of the banking Sector. 35

Table 2: Questionnaire Response Statistics 57

Table 3: Respondents’ Sex 58

Table 4: Respondents’ Age 58

Table 5: Respondents’ Educational Level 59

Table 6: Respondents’ Status/Designation 59

Table 7: Respondents’ Department 60

Table 8: Respondents’ Income Level per annum 60

Table 9: Respondents’ Work Experience 61

Table 10: Responses on Financial Performance 62

Table 11: Responses on Organisational Reputation 63

Table 12: Responses on Conflict of Interest 64

Table 13: Responses on Corporate Scandals and Financial Distress 65

Table 14: Responses on Commitment to Ethics and Corporate Governance 66

Table 15: Responses on Board and Management Responsibility 68

Table 16: Responses on Regulatory/Legal Compliance Mechanisms 70

Table 17: Rating the Effects of Ethical Considerations in Corporate Governance on

Table 18: Ethics, Corporate Scandals and Financial Distress 73

Table 19: Corporate Misconduct and Financial Fraud 75

Table 20: Ethics, Financial Performance and Effectiveness 77

Table 21: Corporate Ethics and Organisational Reputation 79

Table 23: Conflict of Interest and Good Governance Practices 83

Table 24: CBN Codes of Corpporate Governance 85