The interplay of risk management and tax strategies: an analysis of Nigerian public companies (2013-2022)
DOI:
https://doi.org/10.33003/fujafr-2026.v4i1.332.224-238Keywords:
Governance, Management, Risk, Tax strategiesAbstract
Purpose: This study examined the relationship between risk management and tax strategies in Nigerian public companies, focusing on the effects of risk management size, accounting expertise, and independence on tax strategies measured by effective tax rate.
Methodology: The study was based on risk management theory and adopted an ex-post facto research design. Secondary data were obtained from the annual reports and accounts of fifty-four (54) Nigerian public companies covering the period 2013–2022. Data was analyzed using descriptive statistics and correlation techniques.
Results and conclusion: The findings showed that risk management size had a negative and significant effect on tax strategies (t = −7.074, p < 0.05). Risk management accounting expertise also had a negative and significant effect (t = −21.365, p < 0.05). In addition, risk management independence significantly influenced tax strategies (t = −16.863, p < 0.05). These results indicate that stronger risk management structures are associated with reduced tax strategy practices. The study concluded that risk management characteristics significantly influence the tax strategies of Nigerian public companies.
Implication of findings: The findings imply that strengthening risk management structures can help minimize aggressive tax strategies. Therefore, Nigerian public companies should ensure an appropriately sized risk management structure, include members with strong accounting expertise, and maintain the independence of risk governance members to enhance oversight and reduce tax strategy practices.
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