African Journal of Accounting and Financial Research (AJAFR)

Effect of Audit Committee Efficiency on Market Value of Listed Oil and Gas Companies in Nigeria.

Abstract

This study examines the impact of audit committee efficiency on the market value of listed oil and gas firms in Nigeria over the period 2016–2025. Adopting an ex-post facto research design, the study utilizes secondary data extracted from the published annual reports of selected firms quoted on the Nigerian Exchange Limited. Audit committee efficiency is proxied by audit committee size, audit committee independence, audit committee diversity, and audit committee diligence, while firm market value is measured using market-based valuation indicators. Descriptive statistics, panel unit root tests (Levin–Lin–Chu), Hausman specification tests, and Panel Pooled Ordinary Least Squares (OLS) regression were employed for data analysis using EViews (Version 10). The empirical results reveal that audit committee size, independence, diversity, and diligence exert positive and statistically significant effects on firm market value. The diagnostic tests confirm the absence of multicollinearity and autocorrelation, while the overall model demonstrates strong explanatory power. The findings suggest that effective audit committee structures enhance investor confidence, reduce agency costs, and strengthen corporate valuation performance. The study concludes that audit committee efficiency remains a critical corporate governance mechanism for improving firm value in Nigeria’s oil and gas sector. It therefore recommends stricter regulatory enforcement, enhanced governance transparency, and continuous capacity development to sustain valuation gains associated with audit committee effectiveness.