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Economic development, corporate governance, and firm performance in Sub-Saharan Africa

Author

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  • Isaac Luke Agonbire Atugeba
  • Emmanuel Acquah-Sam

Abstract

he study examines the impact of corporate governance on firm performance in five Sub-Saharan African countries, focusing on the role of economic development. The research uses a two-stage least squares (2SLS) regression approach to examine data from 309 publicly traded companies spanning the years 2016–2022. The study found that firms in upper-middle-income (UMI) countries outperform those in lower-middle-income (LMI) countries. Corporate governance positively influences firm performance in LMI countries but negatively affects it in UMI countries. The study further observed that economic development significantly impacts corporate governance-performance relationships in LMI countries compared to UMI countries. Policymakers, especially in UMI countries, are urged to re-assess their current institutional frameworks and consider reforms aimed at alleviating bureaucratic obstacles that impact businesses.

Suggested Citation

  • Isaac Luke Agonbire Atugeba & Emmanuel Acquah-Sam, 2025. "Economic development, corporate governance, and firm performance in Sub-Saharan Africa," Modern Finance, Modern Finance Institute, vol. 3(1), pages 67-90.
    • Handle: RePEc:bdy:modfin:v:3:y:2025:i:1:p:67-90:id:243
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