The Effect of Training Investment on Firm Value of Listed Oil and Gas Firms in Nigeria: The Moderating Role of Board Independence
Taiwo Esther Adeniran
*
Department of Taxation, Faculty of Business Studies, Rufus Giwa Polytechnic Owo, Ondo State, Nigeria.
Olusola Bamidele Adebayo
Department of Accountancy, School of Financial Studies, The Federal Polytechnic Ado-Ekiti, Ekiti State, Nigeria.
Faith Oluwaleke Orimaye
The Federal Polytechnic Ado-Ekiti, Ekiti State, Nigeria.
*Author to whom correspondence should be addressed.
Abstract
Background: In knowledge-intensive and highly regulated industries such as oil and gas, investments in employee training and effective corporate governance are increasingly regarded as strategic mechanisms for enhancing organizational performance and shareholder value. However, empirical evidence regarding the value implications of training investments in emerging economies remains inconclusive.
Aim: This study examined the effect of training investment on firm value among listed oil and gas firms in Nigeria and assessed the moderating role of board independence in this relationship.
Methods: An ex post facto research design was employed using panel data from twelve listed oil and gas firms over the period 2015–2024. Data were obtained from audited annual reports and corporate disclosures. Firm value was measured using Tobin’s Q, while training investment was proxied by training expenditure, training intensity, participation rate, and human capital investment ratio. Firm size and firm age were included as control variables. Data were analyzed using random-effects generalized least squares regression with robust standard errors.
Results: The findings revealed that training investment exerted heterogeneous effects on firm value. Training intensity had a positive and statistically significant effect on firm value, whereas training expenditure and participation rate demonstrated significant negative effects. Human capital investment ratio showed no significant relationship with firm value. Furthermore, board independence significantly moderated these relationships by reducing the adverse effects of training expenditure and strengthening the value relevance of participation rate, although it attenuated the positive effect of training intensity.
Conclusion: The study concludes that the contribution of training investment to firm value depends more on the quality, structure, and governance oversight of training initiatives than on the magnitude of expenditure. Strengthening board independence and implementing outcome-oriented training strategies can enhance firm value and improve investor confidence.
Keywords: Training investment, firm value, board independence, corporate governance, human capital development