This study examines the relationship between internal corporate governance mechanisms and cash holdings among firms listed on the Nigerian Exchange Group (NGX) over the period 2010–2025. Using an ex-post facto research design and a panel regression methodology applied to an unbalanced panel of 148 NGX-listed firms, the study investigates how board size, board independence, CEO duality, managerial ownership, and audit committee effectiveness influence corporate cash-holding decisions. Control variables, including firm size, return on assets (ROA), financial leverage, Big 4 audit firm affiliation, industry dummies, and year dummies, are incorporated to account for firm-specific heterogeneity and time effects. Drawing on agency theory, pecking order theory, and transaction cost theory, the study develops and tests hypotheses linking governance quality to cash accumulation behaviour. Findings from fixed-effects panel regression reveal that stronger internal governance mechanisms, particularly board independence and audit committee effectiveness, are negatively associated with cash holdings, consistent with the agency theory prediction that governance quality constrains managerial opportunism and reduces precautionary cash hoarding. CEO duality and larger board sizes are positively associated with cash holdings, suggesting governance weaknesses facilitate excess liquidity accumulation. Firm size, leverage, and ROA exhibit the expected control effects. Results are robust to post-estimation checks including the Hausman test, variance inflation factor diagnostics, heteroskedasticity tests, and serial correlation tests. The study contributes novel panel evidence from an emerging market context, addresses a critical governance-finance nexus underexplored in Sub-Saharan Africa, and offers actionable recommendations for regulators, boards, and investors in Nigeria's evolving institutional environment.
Onipe Adabenege Yahaya (Mon,) studied this question.