Board Membership Diversity and Earning Management: A Cross Country Analysis

The aim of this paper is the effect of board membership diversity on earnings management among listed non-financial firms in three selected Sub-Sahara African countries (Nigeria, Kenya and South Africa) were used for the period of ten years spanning 2009 to 2018. The study employed ex-post facto research design. The secondary sources of data were collected from annual reports of the selected non-financial firms quoted in their respective stock exchange and three specific objectives and hypotheses were tested and analyzed using descriptive statistics, Pearson correlation analysis and panel regression analysis. Using some selected Sub-Sahara African countries a sample of 470 observations were used, the result revealed that board membership diversity has positive influence on earnings management, the influence is effective in driving the level of manipulated earnings among firms in Sub-Sahara Africa because the result was found to be statistically significant, therefore the researcher rejects the null hypothesis and accepts the alternatives hypothesis which states that foreign board membership diversity has significant effect on earnings management among non- financial firms in Sub-Sahara African countries with a high significant value of 0.005 indicated using hypothesis testing tool. The research concludes that foreign board membership diversity is very influential on earnings management of non-financial firms in Sub-Sahara African countries.